$60b wiped off market (1 Viewer)

[Garygaz]

has it ever occurred to you that some of us are actually studying to become an economist?

Of course it has. I'm not going to try and sound all great and grand but from my limited time at university (3rd year) doing finance and my 2 years working in the market, you see how the 'education and enlightenment' that a degree in commerce gets you is worth less than the paper it's printed on.

I'm not trying to sound like the pompous bastard speaking from the high chair, though you start to see everything in a cynical light when essentially all of the top economists (not as in pay wise, as in accuracy wise) and brokers don't use these bullshit models and schools of thought to make decisions. You don't need to quote all this elementary Keynesian shizen, it's as simple as realizing that the US's problems are simply a result of decades of mistaxing corporations who keep their money offshore (cough apple, google) and George Bush pioneering the fallacious idea of cutting taxes during a recession, and for the rich, at that.

 

[funkshen]

it's as simple as realizing that the US's problems are simply a result of decades of mistaxing corporations who keep their money offshore (cough apple, google) and George Bush pioneering the fallacious idea of cutting taxes during a recession, and for the rich, at that.

So you're saying that this massive meltdown was all because the US government's taxation regime wasn't effective (or rather extractive) enough?

wat

 

[Garygaz]

i'm pretty sure i was referring to their situation of the present

 

[Garygaz]

go look at corporation taxes in the US, all their big TNCs are abusing their system and witholding billions in tax

 

[Garygaz]

tax cuts for the rich in the u.s, there's one basic 1st year/year 12 bit of education that actually has a real world application. MPC, because tax breaks for guys earning >50m each year is going to help your economy as opposed to the guy on $8 an hour.

 

[funkshen]

tax cuts for the rich in the u.s, there's one basic 1st year/year 12 bit of education that actually has a real world application. MPC, because tax breaks for guys earning >50m each year is going to help your economy as opposed to the guy on $8 an hour.

If your argument is that it has something to do with income tax, federal income tax receipts rose every year from the initiation of the tax cuts (which were in general, not just for the rich) in 2003 to 2007. If your argument is that giant corporations are tax evaders, welcome to the real world. Even this can't be the real problem - corporate taxes comprise 9% of federal tax receipts. The fact is, Reagan institutionalised deficit spending and the hamstrung US political system hasn't been able to do anything about it since (though basic measures were taken during the Clinton era like PAYGO and whatnot).

not that i'm arguing those tax cuts were a good idea or that they should be extended.

 

[Blastus]

Cutting taxes during a recession works when it's not just for a small amount of people.

Cutting taxes across the board is a valid stimulus, br8s. Reducing govt spending as a %GDP is the best way to get economy growing because people end up having more money in the long run.

 

[Garygaz]

they are tax evading legally, that's the problem. having increasing tax receipts means nothing when your debt increases at a higher rate than is compensated for by tax.

 

[Blastus]

I'm not saying it would work, or that it's a good idea, or it's not fucking insane. Just saying the US stimulus was Keynesian-lite. I think the actual figure "should have" been like $1.7trn or so. Just goes to show that Keynesian stimulus is not the correct response to massive asset deflation/wealth writedown/pervasive negative equity etc etc, and that it is rapidly becoming an outdated policy prescription.

see: Japan

There is one instance where a massive monetary expansion worked to offset a depression and that was in the gold rush in the US in like the 1840's. The influx of gold meant that the m3 expanded massively offsetting a collapse. M3 increased like 100x over so a comparative stimulus that would actually work would be in the order of ~100tn. It does work it's just because there's so much waste and the system is so imperfect it's economically and politically impossible to institute a big enough surplus if we're going for one to completely mitigate the downturn of a recession.

 

[Blastus]

they are tax evading legally, that's the problem. having increasing tax receipts means nothing when your debt increases at a higher rate than is compensated for by tax.

taxing companies is fucking retarded anyway, tax income (if you have to) and tax consumption, taxing companies is as stupid as taxing trusts (they will try to do it in australia)

 

[Garygaz]

so you're against taxing corporate profits?

 

[Garygaz]

for example we expect to take $58 billion in corporate tax this year, not saying whether it is too much or too little, though if you disagree with the philosophy behind taxing company profits you'd need something to cover the shortfall in revenue.

 

[funkshen]

tax land

need something to cover the shortfall in revenue.

Why? Also, if corporate tax were to ever be abolished it'd be accompanied by government abandoning a lot of areas of spending.

 

[Garygaz]

because $58 billion less in gov expenditure means schools, health, roads and transport gets fucked. I completely disagree that abolishing corp. tax would in any way be a good idea. it's not socialist to realize that some level of taxation needs to take place.

 

[Blastus]

so you're against taxing corporate profits?

They're divested much in the same way that trusts are. Sitting on money earns interest, spending money incurs consumption taxes, etc. Having nil corporate taxation saves us money (tax churn, wasted money on corporate accounting and auditing etc) and no back and forth on deductibles and the rest. Nil corporate taxation would reduce overall expenditure in the long run.

 

[Blastus]

because $58 billion less in gov expenditure means schools, health, roads and transport gets fucked. I completely disagree that abolishing corp. tax would in any way be a good idea. it's not socialist to realize that some level of taxation needs to take place.

The vast majority of roads and transport expenditure is state based which is funded by the GST... so...

Health funding well that's a poison pill anyway as we are ultrafucked in the long run. You promise free healthcare to people and they're going to start expecting it. This is one situation in which we are actually completely fucked as even privatising the health system doesn't magically create doctors - we're already importing as many health professionals as we can from other countries to make up for the shortfall in supply.

 

[Blastus]

If you say "the US has a free market health system and look how bad it is" someone will take you behind the sheds and hit you with a baseball bat

 

[abbeyroad]

Of course it has. I'm not going to try and sound all great and grand but from my limited time at university (3rd year) doing finance and my 2 years working in the market, you see how the 'education and enlightenment' that a degree in commerce gets you is worth less than the paper it's printed on.

I'm not trying to sound like the pompous bastard speaking from the high chair, though you start to see everything in a cynical light when essentially all of the top economists (not as in pay wise, as in accuracy wise) and brokers don't use these bullshit models and schools of thought to make decisions. You don't need to quote all this elementary Keynesian shizen, it's as simple as realizing that the US's problems are simply a result of decades of mistaxing corporations who keep their money offshore (cough apple, google) and George Bush pioneering the fallacious idea of cutting taxes during a recession, and for the rich, at that.

yeah lucky for you few of us here predicate our arguments on bullshit undergraduate models.

behavioral/experimental economics is where it's at yo

 

[abbeyroad]

because $58 billion less in gov expenditure means schools, health, roads and transport gets fucked. I completely disagree that abolishing corp. tax would in any way be a good idea. it's not socialist to realize that some level of taxation needs to take place.

no it needn't

though if you disagree with the philosophy behind taxing company profits you'd need something to cover the shortfall in revenue.

oh here's something that hasn't been thought of before: prices

???

edit also, "free" health care/education blah blah is a misnomer, unless you're a net welfare recipient you still have to pay for it through taxes.

 

[Garygaz]

no it needn't


oh here's something that hasn't been thought of before: prices

???

edit also, "free" health care/education blah blah is a misnomer, unless you're a net welfare recipient you still have to pay for it through taxes.

Are you all hardcore capitalists? You can't just take $60b out of our gov's coffers (and no this isn't a labor v liberal thing) you will fuck so many vital elements in public expenditure. sure you might have some deep seeded philosophical view that taxing privately owned/publicly owned corporations is wrong, though a reasonable course of action can't involve just 'not' taxing them anymore.