And why should they? NIM's are down to about 3% from 3.75% Q3 2007, per FDIC, and that's with a funds rate of basically 0. Not specifically targeting at you, but I think the average person has a very silly notion of how cheap TARP money is. TARP money is cheap by the standards of a company on the verge of bankruptcy, as an emergency fund (think how much AIG bonds would go for if it's facing bankruptcy), it's very expensive to make loans from. The average bank pays about ~1.xx% (latest I think is 1.25) to fund loans they make at 4.xx%. If they loaned out TARP money like Uncle Sam wanted, they'd be losing money on every loan, even if they aren't liquidating/modifying those sub-primes. No offense or anything, how exactly is this supposed to be the rich's problem? Just as my well-being is in no case, your responsibility, yours is no concern of mine either. Yes the rich have seen their taxes reduced, but they STILL pay obscene shares of it. Do I really need to pull you the numbers? What is it, 55% of people in the U.S. don't pay taxes? Top 5% pay 80% of all tax revenue? These are the folks that disproportionately bear the tax burden of well, every country and essentially derive no benefits. Social security? Nope. Health care? They can get much better for what they paid in taxes. And yet you still have a problem with them getting their taxes reduced. Know what I think? I think we need to introduce a true flat tax. Not the flat 16/25/35/whatever percentage crap. True flat tax of say... $80,000 for every man, woman and child. And if you can't pay up, you go to jail. Then you can have that gold plated health plan you always wanted. Or does benefits and self-entitlement not work as well when you actually have to pay for it?
What you fail to understand is that as a % of income the poor and middle class pay more in taxes than the rich. They do no disproportionately bear the tax burden just because they pay more in total. SS for example is based only on the first $106,800 of your salary.
I don't believe the banks are that well capitalized. The point of TARP was to purchase preferred shares to provide capital and liquidity in order not to save the individual bank, but to save the financial system and in that save every business that depends on them for liquidity. We provided substantial capital to these banks in order for them to profit. Through substantial declines in the real estate markets and the indecent amount of leverage, their capital base was eroding at incredible levels. They still sit on bad loans that are becoming worse by the second as defaults continue and unemployment remains high. If we would've let them keep that additional funding without exacting harsh penalties (executive comp. limits etc.) then the banks would've been overly funded....which in turn allows them to provide liquidity to businesses....which in turn allows them to not have to let people go.....which in turn means people buy more goods and pay their bills on time....which in turn means the loans on banks' balance sheets look better! Mohammad El Erian of PIMCO and formerly the Harvard Endowment said the financial system is like the oil in a car. Even if everything else is working fine, the car will not run without oil. By pushing the banks to pay back the money before they should have ( a bunch of greedy execs don't want their compensation cut but thats part of the hazard ) and by increasing costs to them first in raising FDIC limits now and then by adding financial regulatory issues with the new bill, we have severely impacted the financial strength of these institutions which are not lending and therefore creating stagnant unemployment which erodes their capital base even more. The administration was wrong in its actions. Look at BAC's or Citi's stock price if its any indication.
I would suggest this is nonsense. In return for their tax money, they get the opportunity to make lots and lots of money and live a 1st class life - opportunities they wouldn't have elsewhere. They get the benefit of living in a capitalist society which has skyrocketing division of income - something that hasn't really benefited the poor over the last 30-50 years when their incomes have stayed flat. After all, the rich could simply move to a random island and not have to pay the taxes or get the benefits - and we see that they don't choose that. So yeah, they get quite a few benefits from what they pay in taxes.
I would disagree here. All the stats show banks sitting on plenty of capital. Agreed - and this part worked brilliantly. While true, they've already written down the vast majority of that stuff. So those loans defaulting doesn't really affect the banks at his point. If they don't default, that will be great and they will get to "write up" the loans, but they've already taken most of the pain. Large businesses have plenty of liquidity - they have record levels of cash. And they are still letting people go, so the evidence doesn't fit here. Large companies are not laying off people because they lack cash. For small businesses, it may be the case - that's where you have more of a liquidity crunch. But the banks do have large levels of liquidity and are simply choosing not to lend it to the smaller businesses. BAC and C's stock were diluted, which is the cause of their low stock prices. All indications are that they are well capitalized and in pretty good health going forward. That was shown by their ability to fairly easily raise the money from the equity markets to pay back their TARP money.
I might agree with you if you stated that 55% of Americans don't pay income taxes, but everyone in America pays taxes in one way or another. In fact, Warren Buffett talked about how he paid a lower percentage of his income in 2006 than his secretary did, even though he did not take extraordinary steps to avoid higher taxes. Are you effin kidding me? The rich get the absolute best of everything in this country, live in the lap of luxury, have the best security, fire protection, court system, infrastructure, and the richest market in the entire world. These are the people who should bear ALL of the tax burden, at least according to Jefferson, who once said... "The rich alone use imported articles, and on these alone the whole taxes of the General Government are levied... Our revenues liberated by the discharge of the public debt, and its surplus applied to canals, roads, schools, etc., the farmer will see his government supported, his children educated, and the face of his country made a paradise by the contributions of the rich alone, without his being called on to spend a cent from his earnings." --Thomas Jefferson to Thaddeus Kosciusko, 1811. Yes, I have a problem with them getting their taxes reduced. Our infrastructure is crumbling, our school system is getting worse year after year, our deficits and debt are exploding and all of this began when Reagan started cutting taxes on the wealthy. Again, are you effin kidding me!?!?! You are so disconnected from reality that you don't even seem to understand that the tax you describe would be around double the median family income. In fact, 75% of Americans would owe more than their entire yearly salary. We do have to pay for it. I have paid 6% of every single penny of my income since I started working into Social Security while the rich have their SS payments capped at ~$100K. As linked above, people with Warren Buffett's salary can get away with paying less than 18% of their income in tax where his $60,000 secretary pays over 30% of her income. We have allowed the rich to bamboozle us with fraudulent tales of welfare queens and lazy people living like kings on disability and in doing so, have allowed them to have their taxes lowered while the rest of us pay more and more. They are greedy. I would be on board with changing the tax code to a consumption tax, but you wouldn't like the way I would modify the FAIR tax. The rich enjoy their gains because of the work of the people who are being called lazy and decried as leeches. They have and enjoy the best that our society and because they enjoy the best, they get to pay the most. Welcome to the progressive income tax, be prepared for it to become more progressive once the working class realizes what the rich have been up to the last three decades.
he's like a dyslexic Robin Hood, GR. The rich are a pretty mobile lot. If they felt the tax burden exceeded the benefits of being in America, we'd see more of them leaving. And if R1981 really wanted to make his point, he'd have to compare the US tax burden on the "rich" to other industrialized countries. The $320K of income taxes on a family of four is a novel take though. Especially with jail time for non-compliers. So kudo's for that!
But the fact that they didn't have the capital but raised it by diluting their own shareholders (and screwing their previous shareholders) and issuing new shares portray their true lack of liquidity and strength? Their capital structures may look reasonable but when leverage ratios are still so painfully high, they know all to easy that minimal declines in asset values of leveraged cdo's etc. will result in further markdowns which will erode values even more. The short-term backing of the commercial paper markets (funding facilities), buying of MBS/CDO's by the fed, limitation of the housing tax credits (which I thought were a great idea except for the populist income bracket nonsense), cost of FDIC insurance are all moving away from the positive direction capital wise for banks. Unless organic housing markets growth rates surpass supply (not much has been built) and unemployment turns we could see further write-downs of these assets which would again force the banks to re-capitalize. Their fear of these scenarios and potential lack of faith in the administration or whatever reason is forcing them to demand higher liquidity rather than lend which the administration deprived them of to look good politically. I think as silly as Bush was to proclaim "Mission Accomplished" in Iraq, Obama is looking pretty silly stating that the economic war was virtually over as well. I'm not being political here. Bush was at the reins when the Net Capital Rule was abolished for companies with over a $5 billion dollar market cap. This to me was the greatest driver of leverage, which was the tinder that the housing market decline needed to cause a blaze. But Obama is making some mistakes to appease his populist image and idealogy that are detrimental to the recovery.
Of course as a percentage of income, the middle class pay more. What's the point here really though? Every person has the social mobility to pursue higher income since we're not living in an Indian style caste system. Who's fault is it that someone else is just better at it than you or me or whoever? And it's not just contributions either. It's also claims. SS claims phase out, meaning the rich claim less too. Ditto health care, which the rich can afford much better of with all the money they pay. Let me put it this way to make it simpler. Bob, Joe, John and Steve work for the same company. They go to happy hour together every Friday in which they spend $100. Bob the CEO pays $80. Joe and John the associates, each pay $10. Steve the janitor pays nothing. Then one day the waitress said, "you know guys, you've been such good customers for so long, I'll give you a $20 discount." Everyone likes the idea. So Bob got $16 back. Joe and John each got $2. Then outside, Joe an John said, wait, Bob got $16, we only got $2. Steve, who paid nothing, says I want my $16 too. They beat up Bob and takes his money. Next week Bob was so upset he didn't go. So even though the other 3 only consume $75 worth of drinks, they didn't have enough money. That pretty much sums up tax cuts in America. I would argue that's just bone-picking on your part. But while we are on hypotheticals, which random island do you propose the rich move? After all, we've only a very finite amount of land and I don't see new countries propping up without a fight. What you are highly guilty of here is taking the question in isolation. The reason the country IS a capitalistic society in which you could make a lot of money is in large part, because of those people, who generate the opportunities and income to enable some to have a "first class life." Bottom line here, and I mean this as an honest question. Do you really believe that, if the rich are somehow able to get their own country, they'd be enable to have the majority, if not all the benefits they can derive here with all the dough they're paying? Yes you are right in that regard. But since that being the topic in question, I left out some keywords. And so what if Warren Buffet paid a lower percentage than his secretary? His lower percentage is much much higher than what his secretary would be able to generate even over many years. I'm kidding you how? 1. You have the very same opportunity to "have the best of everything" as the rich. The only difference you are unable to generate the same income to enjoy all that they can enjoy. And now you're crying about it. 2. Thomas Jefferson was wrong. Through taxation, the rich had already seen their income reduced and spent in a transfer of wealth that can only benefit in one direction. So in other words, in your opinion, the infrastructure is crumbling solely because the rich had their tax cut? Really? So you don't think all those earmarks and entitlement programs that you yourself profess to love have anything to do with them? What are the major spending categories by the U.S. government? Defense, which of course benefits everybody. What are two of the other major categories? Remind me again. And do you believe the wealth proportionately benefit from the categories, relative to what they paid for them? Not at all. It was an extreme example meant to demonstrate a point, which apparently it didn't hammer through your thick skull. I don't expect it to ever get done, but I happen to think that $80 grand flat tax is perfectly fair. Why? It gives no discrimination to race, colour religion, sexual orientation, name, age, gender or what have you. All it asks is that you do your part. And in this case you're telling me you can't. See here's the thing, as I've already mentioned, you don't know how good you already have it. Pay a less than "fair share" and enjoy most of the benefits. And you want your proportion of "fair share" to ever reduce relative to the base while your benefits to ever increase. Perhaps if you were actually paying for those benefits, as you would in the extreme $80,000 flat tax example, you'd be more aware how good you had it. Do me a favour here. Multiply Buffet's secretary's income by the 30% you quote then multiply Buffet's income by his 18% and tell me who paid more. It's I think, absolutely hilarious that you call me out of touch with reality when you are incapable of simple arithmetic. The rich, greedy? Pot calling kettle black much? People are greedy. The only difference is that you pretend you're not. But then again, if you were not, you wouldn't be trying to raise THEIR taxes to benefit YOU now would you? People are greedy. Used to be the first line a Econ 101 textbook. And pray, do tell me, what are they up to? Let's not get diplomatic here. You are leeching the system, if it is defined as deriving more benefits than you paid for them, however hard to measure that is. Perhaps you care to bring the top marginal tax rate up to >90%, but then the claim that you are leeching the system would be even more convincing now wouldn't it? Let's be perfectly honest here, you gave precisely the arguments I expected you to give, because it is the same arguments your type always give. Use a percentage as a measure of tax burden instead of dollar terms; starting off pretending to be fair then mutating to morals. Some people down on their luck? Yes it's sad. But you wanting to give them a helping hand, that's not fairness. That's your morals. Just like your belief in a progressive tax system is your morals, not fairness. The key thing here (and what p1sses me off the most) is the same type of self-entitlement people like you always exhibit. You are already benefiting from the existing system but you ask for more. It's kinda like you give 2 bucks to a hobo on the street and he goes "FU ***** I deserve 5 bucks." That's just pathetic.
What's the point? The point is that it hurts the middle class more than it hurts the rich. It's more of a burden to take away a larger % from a middle class person than a rich person. And don't give me this everyone can pursue a higher income BS like every rich person is some Horatio Alger or Bill Gates entrepeneur. I guess no rich person ever inherits money or is taught their family business and handed over the keys. For every Michael Dell there are many more Paris Hiltons who inherited their riches.
If you're going to plagiarize at least give credit to Professor Davies. I know this because I've seen this regurgitated at least a dozen times on other boards. http://www.snopes.com/business/taxes/howtaxes.asp
You know, I was gonna cite, except I forgot the exact source. Regurgitated? Why? Because it's true. Whether or not it's regurgitated makes it no less true. Do you have a problem with it being regurgitated or it being true? I hope no the latter. Please point out to the part in which what I said is untrue. Are you NOT permitted to pursue higher wealth? Yes there are Paris Hiltons out there, but you can take comfort in the fact that Paris Hilton's income will run out. In fact, the good portion and majority of millionaires are self-made. The richest list? Virtually all of them self-made, except those in India apparently. Add on top of that the fact that it is EXCEEDINGLY easy to become better off in any developed country, but especially in the U.S., where with the ever decreasing educational standards, it's very very easy to obtain a college degree and improve your lot in life. Of course, nobody is suggesting you have to become rich, but you could provide a better quality of life for yourself so that your kids can perhaps pursue more opportunities. Or do you believe that your life is not materially or otherwise improved just because Paris Hilton the ***** inherited more money and bitter on that point? I'd call that greediness.
Pot shot taking drama queen is back. At the shot of sounding like a broken record here Sammy, do you have points that you can provide that actually refutes mine own? Different day, same old dance Sammy. How so? http://mw4.m-w.com/dictionary/aristocracy Did I inadvertently in my posts, propose some kind of hereditary system in which you are precluded? If so let me know where. I think I've been very clear through my posts that YOU have the very same OPPORTUNITIES to pursue exactly what the rich now enjoy. If you think that's being aristocratic, let's re-write the dictionary.
what point is that, that you CTRL-V'd a dumb chain e-mail on snopes? No I am unable to refute that you did this.
