LOST TO THE GREAT RECESSION

I am a registered unaffiliated voter in Caroline County, Maryland and here is my story:

I worked hard and the last years of working I saved the maximum that I could in my 401K. I retired at 59 ½ and started withdrawing $1283 a month; with this amount I was not reducing my principal.

Then came the recession of 2008; and it became quickly apparent that I would have to reduce my monthly withdrawal or quickly kill my principal. My Agent recommended that I reduce my monthly withdrawal to $825 which has proven to be a good figure to maintain my principal.

SO I HAVE LOST $458 IN MONTHLY INCOME. I AM STUCK AT THIS POINT NOW; NO COST OF LIVING INCREASES HERE!

SCREW THE AVERAGE AMERICAN CITIZEN OUT OF PERSONAL WEALTH, JACK UP THE NATIONAL DEBT TO AN ALL-TIME HIGH, JACK UP BUSINESS DEBT TO AN ALL-TIME HIGH, ALLOW RECKLESS COMPUTER TRADING, AND GIVE MASSIVE TAX CUTS; THIS IS FISCAL RESPONSIBILITY?

DOES CONGRESS REGULATE COMMERCE OR DOES COMMERCE REGULATE CONGRESS?

FORBES   AUG 20, 2018, 07:33PM

THE GREAT RECESSION DIDN’T COST EVERYONE $70,000: THE WEALTHY MORE THAN RECOVERED

 Erik Sherman  Contributor   Personal Finance

A week ago, a Federal Reserve Bank of San Francisco study made an obvious point: the Great Recession cost people a lot. What wasn’t so obvious was the tally:

A decade after the last financial crisis and recession, the U.S. economy remains significantly smaller than it should be based on its pre-crisis growth trend. One possible reason lies in the large losses in the economy’s productive capacity following the financial crisis. The size of those losses suggests that the level of output is unlikely to revert to its pre-crisis trend level. THIS REPRESENTS A LIFETIME PRESENT-VALUE INCOME LOSS OF ABOUT $70,000 FOR EVERY AMERICAN.

Congressional Budget Office revisions to actual GDP (GDP adjusted for inflation) — over the 10 years since the whole mess got so large that no one could ignore it — IMPLY THAT THE COUNTRY HAS LOST 12 PERCENTAGE POINTS OF GROWTH COMPARED TO WHAT THE PRE-CRISIS TREND SUGGESTED…

HOWEVER, REMEMBER THAT AN AVERAGE NUMBER IS SOMETHING SPREAD OUT ACROSS EVERYONE. IT ASSUMES AN EQUAL IMPACT ON EVERYONE AND DOESN’T CONSIDER DISTRIBUTION. After the economic collapse, there were some who ended up doing pretty well, according to Federal Reserve figures. THOSE IN IN THE TOP 10% SAW MEDIAN WEALTH JUMP BY 26.6% SINCE 2007. EVERYONE ELSE WAS AT BEST ALMOST BACK TO WHERE THEY WERE (80TH TO 89.9TH PERCENTILES) OR SIGNIFICANTLY WORSE OFF (ALL OTHERS).

That isn’t a $70,000 loss of income. IT’S A LARGE INCREASE FOR THE TOP 10%, because an increase of wealth returns on investments are up, which is income…

GOOGLE SEARCH “NATIONAL DEBT”:

The aggregate, gross amount that Treasury can borrow is limited by the United States debt ceiling. As of October 28, 2018, debt held by the public was $15.8 trillion and intragovernmental holdings were $5.8 trillion, for a total or “National Debt” of $21.6 trillion.

ROLLING STONE  JULY 2, 2018 2:32PM ET

WE NEED A FINANCIAL TRANSACTIONS TAX BEFORE IT’S TOO LATE

As the country sits atop a giant debt-bomb, measures are needed to rein in excess speculation

By MATT TAIBBI               

Sunday’s CNN Money headline was terrifying:

“The $6.3 trillion debt binge: American companies have never owed this much”

Thanks to low interest rates, Trump’s tax cuts and a financial unsafe-sex atmosphere where regulatory oversight is almost nonexistent, companies are borrowing massive amounts and encouraging waves of stock buybacks, sending an already insane market to worrisome new heights.

That $6.3 trillion debt bomb upon which corporate America is sitting is now bigger than any in history, eclipsing even pre-2008 levels. The national “economic miracle” Trump keeps lauding is – like his own financial empire – resting on a bed of borrowed cash…

ON JUNE 27TH, SEN. KIRSTEN GILLIBRAND (D-NY) BECAME THE FIRST CO-SPONSOR TO S. 805, THE “INCLUSIVE PROSPERITY ACT OF 2017,” ORIGINALLY INTRODUCED BY BERNIE SANDERS.

The bill is the American version of a Financial Transactions Tax, a plan to raise revenue and curb speculation by attaching micro-taxes to financial transactions. The E.U. moved toward an FTT plan for 11 Eurozone countries in 2013.

The Sanders camp trumpets the plan as a money-raiser – a way to pay for big-ticket social programming like free college tuition. But it also has a huge safety component.

The Wall Street version of a sin tax, even the tiniest financial transactions surcharge could help rein in greed orgies just enough to keep the economy from exploding. In the past, these micro-taxes have been envisioned as a way to pay for the inevitable bailouts in our increasingly deregulated economy…

In a computer-dominated trading environment, the aim isn’t just to move the stock with your own purchase power. The idea is also to trick other algorithmic traders into mass-dumping or buying their holdings.

USING THIS TECHNIQUE, A SINGLE SLICK OPERATOR CAN GENERATE HUGE VOLUMES OF TRANSACTIONS OFTEN WITHOUT HAVING MUCH OR EVEN ANY SKIN IN THE GAME.

ALL OF THIS ACTIVITY HAS NO REAL ECONOMIC PURPOSE, OTHER THAN TO MOVE THE “TAPE” FOR AN INSTANT OR TWO AND MAKE SOME OVER-MOUSSED WALL STREET PARASITE A BUNCH OF UNEARNED MONEY…

High-frequency trades currently make up between 50 and 60 percent of all stock transactions in the U.S., which isn’t inherently bad, but it’s not necessarily a positive thing, either. For sure, there’s a ton of economically useless activity buried in that percentage.

A FINANCIAL TRANSACTIONS TAX KILLS THREE BIRDS WITH ONE STONE. IT RAISES MONEY, PROVIDES A MAJOR DISINCENTIVE TO SOCIALLY USELESS VOLUME-BASED TRADING AND DECREASES DANGEROUS SPECULATIVE VOLATILITY…

A FINANCIAL TRANSACTIONS TAX MIGHT HELP INCENTIVIZE WALL STREET TO ONCE AGAIN EMPHASIZE TRUE LONG-TERM INVESTMENT, AS OPPOSED TO SPENDING ALL DAY MOVING PILES OF MONEY AROUND…

STILL, A SENATOR FROM NEW YORK SIGNING ON TO AN IDEA SO UNIVERSALLY DESPISED BY WALL STREET IS WORTH RAISING AN EYEBROW OR TWO. HOPEFULLY IT LEADS TO SOMETHING MORE, PERHAPS EVEN BEFORE IT’S TOO LATE.

THE NEW YORK TIMES

NEWS ANALYSIS

IT’S OFFICIAL: THE TRUMP TAX CUTS DIDN’T PAY FOR THEMSELVES IN YEAR ONE

FEDERAL TAX REVENUES DECLINED IN 2018 WHILE ECONOMIC GROWTH ACCELERATED, undercutting the Trump administration’s insistence that the $1.5 trillion tax package would pay for itself.

By Jim Tankersley   Jan. 11, 2019

IT’S TIME TO PUT TO REST ANY NOTION THAT PRESIDENT TRUMP’S SIGNATURE TAX CUTS ARE PAYING FOR THEMSELVES. ANYONE WHO SAYS OTHERWISE IS LYING WITH NUMBERS.

A year after the $1.5 trillion tax-cut package took effect; economic growth has accelerated, just as Republicans promised it would when pushing the law through Congress. Growth appears likely to hit 3 percent for 2018, after adjusting for inflation, which is a full percentage point higher than the Congressional Budget Office forecast for the year in 2017. Not all of that increase is attributable to the tax cuts, but some of it is.

That’s good news for Republicans’ longstanding claim that cutting taxes would provide such an economic bump that additional tax revenue would flow in to make up for what was lost through lower tax rates.

But the bad news is that hasn’t happened. The additional tax revenue has yet to show up, even with stronger growth.

Data released this week by the budget office provides the first complete picture of federal revenues for the 2018 calendar year, when the tax cuts were in full effect. (The government’s 2018 fiscal year included three months from the end of 2017, when most of the tax cuts were not in effect.)

IN THE INAUGURAL YEAR OF THE TAX CUTS — WITH ECONOMIC GROWTH ACCELERATING AND THE JOBLESS RATE FALLING TO AN 18-YEAR LOW — FEDERAL REVENUES FROM CORPORATE, PAYROLL AND PERSONAL INCOME TAXES ACTUALLY FELL.

THAT’S TRUE WHETHER YOU ADJUST REVENUES AND GROWTH FOR INFLATION — OR NOT.

AFTER ADJUSTING, IT LOOKS EVEN WORSE. REVENUES FELL BY 2.7 PERCENT — OR $83 BILLION — FROM 2017. CONTRAST THAT WITH THE LAST TIME ECONOMIC GROWTH APPROACHED 3 PERCENT, BACK IN 2015. THE ECONOMY GREW BY 2.9 PERCENT AFTER ADJUSTING FOR INFLATION THAT YEAR — AND TAX REVENUES GREW BY 7 PERCENT…

In the summer of 2017, for example, the budget office projected that the economy would grow by 2 percent in the 2018 fiscal year, and that personal, corporate and payroll taxes would add up to $3.24 trillion. Then the tax cuts passed, growth accelerated and, for the 2018 fiscal year, tax revenues fell $183 billion — or 5.6 percent — short of that projection…

The 2018 results are, oddly enough, what a lot of economists predicted would happen with Mr. Trump’s cuts, including ones who generally favor tax cuts. TOTAL FEDERAL REVENUES IN 2018 CAME IN ROUGHLY WHERE THE TAX FOUNDATION, A WASHINGTON THINK TANK THAT TYPICALLY PROJECTS LARGE GROWTH BOOSTS FROM TAX CUTS, HAD FORECAST — WHICH IS TO SAY, WELL BELOW THE BUDGET OFFICE’S BASELINE.

Just because the new law helped to increase economic growth, said Kyle Pomerleau, an economist with the Tax Foundation, “it doesn’t mean that it is going to pay for itself.” Mr. Pomerleau said additional growth from the law “will continue to be modest over the next couple of years.”

“That will offset some of the initial cost,” he continued, “but it will still be nowhere near enough to make the tax cut self-financing.”

IN DECEMBER 2017, AS REPUBLICANS SPED THE TAX CUTS THROUGH CONGRESS, THE TAX FOUNDATION RELEASED A PROJECTION THAT THE CUTS WOULD ADD ABOUT $450 BILLION TO FEDERAL DEFICITS OVER 10 YEARS, AFTER ACCOUNTING FOR THE ADDITIONAL ECONOMIC GROWTH IT WOULD SPUR. THE GROUP HAS SINCE REDONE THE ANALYSIS, WITH WHAT MR. POMERLEAU CALLED IMPROVEMENTS TO ITS METHODOLOGY. IT NOW PREDICTS DEFICITS WILL INCREASE BY $900 BILLION — DOUBLE ITS ORIGINAL FORECAST.