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Simon Black On Another Form Of Inflation
From Simon Black of Sovereign Man
Another Form of Inflation
Sticker shock in grocery store checkout lines and gas pumps around the western world is starting to set in. At this point, you have to be living under a rock to not notice that prices of goods and services around the world are increasing substantially.
Much of the blame for rising prices has rightfully been levied on the uncontrolled expansion of central bank balance sheets-- the US Federal Reserve, for example, created more money in the last two years than it had created in the previous 200. Rejecting reject the possibility that any of this money could impact consumer prices is just intellectually dishonest.
There is another factor, however, that weighs heavily on inflation, and it is seldom discussed in this context: taxes.
Everybody hates paying taxes... but what few people realize is that tax hikes fuel rising prices. When payroll tax rates, import duties, corporate profits tax rates, sales tax rates, etc. increase, it's always the end consumer at the cash register who gets stuck footing the bill.
This is happening across the world right now, including in the United States. While governments in places like Illinois have made headlines for infamously raising their income tax rates in the middle of the night, local government tax hikes are going largely unnoticed.
At present, 14 cities across California are raising their local sales tax rates, the highest being in Union City and El Cerrito (near San Francisco) to 10.25%. Then there's Prattville, Alabama, a town of 30,000 near the capital Montgomery, which just raised its local sales tax rate 1% to 9.5%
This has the effect of making everything more expensive-- instantly. Now, 1% might not seem like that big of a deal, right? This is how politicians think-- do we really care if we pay $50 at the checkout line, or $50.50? Of course not, it doesn't matter.
It's not about a single purchase, though, it's the aggregate of all of our purchases, and its starts to add up. Not to mention, there's the slippery slope of thinking "well, if 1% didn't matter last time, let's hike tax rates another 1%."
Over time, the same thing happens when income tax rates rise. When individuals have less disposable income to spend, everything certainly feels more expensive... and when corporate and payroll tax rates increase, those increased costs get passed on to consumers in the form of higher prices.
There are some places in the world, however, that are getting it right. Singapore is one such place. Rather than concerning itself with dropping bombs and establishing military bases in other countries, the government of Singapore is living within its means setting conditions for the continued growth and prosperity of its residents.
This morning, I received a welcome email from one of my prime contacts on the ground in Singapore. As it turns out, the government there is cutting its tax rates. Again. And my friend, a "who's who" in the Singapore corporate structure industry, sent along a very helpful guide to show me just how serious Singapore is about growth.
Individual income tax rates, which are already among the lowest in the developed world, are being cut. For example, income in the range of S$80,000 to S$120,000 (S$ is the Singapore dollar... this is roughly $65,000 to $95,000 USD) will now be taxed at a marginal rate of just 11.5%, down from 14% before.
For companies, corporate profits below S$100,000 (roughly $80,000 USD) under the old rate schedule were not taxed. This is still the case... and one of the reasons why Singapore is such an attractive draw to entrepreneurs-- because, for a startup, those initial profits are incredibly important.
The next S$200,000 in profits (roughly $160,000 USD) used to be taxed at 8.5%. This has been cut to 6.8% under the new scheme, so the effective tax rate on roughly the first $240,000 USD is only 4.5%. Pretty reasonable.
The next S$194,118 in profits (roughly $154,000 USD) used to be taxed at 17%; this has now dropped to 13.6%... and finally, all profits above S$494,118 (about $392,000 USD) are taxed at 17%.
As corporate profit tax schemes go, this is incredibly low. A company with roughly $400,000 (USD) in profits would have an effective tax rate of just 8%, and a company with $1 million (USD) in profits would pay an effective tax rate of just 13.5%.
Singapore has also made new allowances in how businesses can deduct expenses through the "Product and Innovation Credit (PIC) Scheme." The PIC Scheme allows businesses to deduct up to 400% of the actual expense for things like research and development, design, acquisition of intellectual property rights, etc.
While these tax benefits are advantageous for all companies, Singapore lends itself particularly well to entrepreneurs and professionals who generate the preponderance of their income online: it's a strong, independent, transparent jurisdiction to structure, it's one of the safest banking jurisdictions in the world, and the government provides generous allowances for royalties and intellectual property.
I've been traveling in the US for almost 3-weeks now, and as usual, I've been pretty amazed at all the gloom, bad news, and overall economic malaise. I'm here to tell you that there are still plenty of places in the world with significant opportunity, where productive, talented people are treated like valuable assets instead of milk cows.
Singapore is one of those places, and I think it makes a lot of sense to consider relocating there (if you're a skilled professional, investor or entrepreneur) or looking to structure a foreign business (especially an online company).
Tomorrow, I'll be releasing interview I just conducted with a friend of mine who is a very successful online entrepreneur. He is another Atlas 400 member, and a phenomenal teacher about what he does.
I hope that, between the valuable insights he provides in the interview about building a new online business, and what we've discussed about places like Singapore, it may give you some ideas for a different direction.
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Hmmm, opportunity, bitchez?
Taxiation without representation, bitches!
Taxi! Taxi!
no matter what the law seems to say, the u.s. has low corporate tax rates. wage earners, from the poor to the n.b.a., are screwed. the owners of capital not so much. said as the latter not the former.
GE 14b in profits tax bill zero not one dime
US TAX FREE INCOME FOR overseas generated income by US companies ( even if the income was from selling goods to America).
WHAT? Thank you Republicans (Bush)for creating it, and Thank you Democrats for maintaining it. Both of you keeping your loyal fans happy.
All income should be taxed AS IF generated IN the US, and THEN the foreign taxes ( if any) deducted from the amount and the balance paid with honor ( hahaha) by the companies.
This CRY-ME-A-River the companies (and politians) pull about the supposed high taxes they pay makes me sick. And, who covers their ass when their is a problem doing business in these foreign lands....why the sucker American joe-blow taxpayer.
Look at the recent comment by John Chambers, Cisco, that "he would bring jobs back to America if the US would lower taxes to 5%" Hey John FUCK YOU and the billions you have made off America...you shameless shit. I'll laugh my ass off when China nationalizes you ASS-etts or their servers eat your alive.
No FU, if a company like Cisco wants to escape the fascist/socialist parasitic state...good for them, quit defending the complete BS Wellfare/Warfare nazi country this has become....so I and others should be taxed to death to fund the endless wars, the endless debt and money printing ponzi scheme, the endless welfare handouts... that productive companies like Cisco which produce real products that people want on the free market should be hosts to parasitic totalitarian fuckheaded socialist/fascist utopian delusions by the political class or their parasitic political supporters that relies on the blood siphoning they do to purchase their support. Yea, just tax everyone, tax em tax em tax em, that is the fucking solution....that will bring utopia....our problem is that we do not tax enough...you have fucking convinced me you dumbshit. Just FU to hell you moron.
Fuck whoever junked you for that.
Nobody is as screwed as the property owners. They are the true serfs: "bound to the land".
Buying property is the same as dropping ones drawers, bending over and asking a predatory tax regime to take you from behind.
Amen.
Please raise your hand if you were previously bewildered by the concept of higher taxes = higher prices before you read this Magnum Opus of Obviousness Stating.
Those of you raising your hands, please exit that way ===>
May I suggest a basic course in 3rd grade math before you decide to re-visit?
Thank you, drive through.
I am Chumbawamba.
+1 agreed. I don't read this blog to find out shit I already fucking know. That would mean I re-learned shit I already knew and that... well that's just unacceptable.
P.S.,
How many minutes do you think you've spent re-writing your username? We get it. You are Chumbawamba. You get knocked down, you get up again. We're never going to keep you down.
Oh what the hell. Nevermind.
My Profile, Edit, Signature...does the repeating for you, for you...
Funny thing about that. I set my signature early on when I first created my account but, you know what? It never worked. So yes, each and everytime you've seen it, I typed it.
It is a conscious and overt act in which I am signing my moniker to what I write. It is my seal.
I am Chumbawamba.
brb, reliving memories of 8th grade sock hop..
Chumbawamba+Third Eye Blind+Sugar Ray+MatchBox 20+Goo Goo Dollas+Gin Blossoms+Backstreet Boys
I wish I got to live during the 1950s :(
America has been on a rapid spiraling decline for 2 generations now.
Sounded more like a pitch to expatriate to Singapore.
yes, you will love the jail sentencing for spitting, cussing, singing in public, smoking anything, expressing 'christian' views.
It does not seem to bother Jimmy Rodgers.
Jim Rogers lives in Shanghai.
and "Japan has added more to it's balance in two weeks than the Fed has in its entire history." Welcome to "the petri dish of finance." The Bernank's theories are about to be put to the test: release the slide rules!
Then why didn't prices go down when they extended the Bush era tax cuts? Why don't prices ever go down on any tax cut? Because your logic is flawed. There is no direct connection between prices and taxes other than narrative. Management thinks customers will believe that prices had to go up because taxes went up so they pass them on to increase or maintain profitability. Managements will do anything other than reduce profitability and bonuses you know. Any bogus excuse will do. Thanks for forwarding yet antother bogus excuse. If you assume that managements were already charging the maximum that the market would bear then all increased taxes would do is decrease corporate profitability because they were already and always charging as much as they could.
"There is no direct connection between prices and taxes other than narrative. "
Your premise is flawed. Ask the blue States that are bleeding populace.
Plus, tax rates were kept level, not cut, on the extension.
Dude, you might be on the wrong blog.
now, now. that's the beauty of it. arguments get critiqued.
That wasn't an argument, but rather convolution concentrate.
Hey Paul DumbF#@k (PDF) YOUR logic is flawed. PDF has a lack of logic (LOL)
"There is no direct connection between prices and taxes" - PDF
Classic. Anything you say after that becomes irrelevant.
sometimes you get to raise prices because of higher taxes, etc. etc. and sometimes you don't. is that a direct connection? sure you'd always like to raise prices, taxes or no. but that's not the same thing.
and, at least for me, it's not the taxes that really piss me off. it's the hideous shit they spend it on.
How in the hell did you figure that raising sales tax wouldn't have a direct effect on prices?
They have to get the money somehow. The exception of course is the wealthy who has everything they want shipped and billed to their tax exempt foundations but really, they don't count anyway. The mere idea of them getting little people's food and little people's leisure items is simply bowling alley behavior
I think you completely missed the point. He's speaking of the inflation of taxes, and how it decreases disposable income - not necessarily how it impacts the prices of individual goods.
For instance, when a road gets tolled for the first time, that's inflation of taxes paid. Does it impact the price of a banana, no. But it reduces the disposable income an individual has, and therefore leads to further economic decline (unless you believe in taxation and big government). A highway in my area is getting a $2.50 to $5.00 each way toll in the next couple of months. Commute 200 days a year, and that might add up to $1,200 in after-tax dollars. That's not insignificant.
His example of sales taxes seems to suppose a base level of necessary spending. So, if you have to spend $20k on necessities per year, a 1% sales tax rise would cost you an extra $200. You don't have a choice. This reduces your other spending proportionally.
Does it impact the price of a banana, no.
It will impact the price of the banana if any of the costs of bringing the banana to market were increased by having to pay the toll.
So the chances are it will impact the price of bananas (and everything else) sold locally.
Black is quite correct - taxes raise prices generally, because they raise costs.
Raises costs for non-productive activity.
now, this is productive activity by just one company... Around the trun of the year, I wrote that I had been noticing many grocery items adopting the new 13.5 ounce-is-the-new-pound packaging.
I first noticed this at Thanksgiving, unknown number of friends for dinner, and didn't want to be caught short of sweet potatoes. I looked at a brand of instant potatoes which included sweet. All the boxes were 9.5 to 8 ounces each...cheese 'infused' the lower weight. I thought 1.98 for a box of instant sweet potatoes...pricey. Well, I was in the same delima at Christmas and those same boxes were now 7.2 to 6.8 ounces for the same price.
Yesterday at the store, a big display of "NEW FLAVORS!". Well, new and old were now 4.6 to 6.2 ounces for the same price. Tht is near 50% price vs weight difference in under 6 months.
It really hit me at how the American consumer is being inflated without their being aware of it. I have mentioned these obversations to most I know, and none even look at the package weight on anything.
Heaven help the ordinary bread winner with kids trying to make ends meet. Americans don't understand what is being done to them...mostly by the Fed.
So folks...look around you, you are being screwed by deception.
It's clear that most of these people have never had the benefit of a 300 level economics course in their lives. Therefore all the invective and "dude" this and "dude that. If you want to get technical any product with a non-zero cost of production where unit cost is variable depending on economies of scale has a cross over point where all increased costs will do is reduce gross profit. The term "taxes" is also nebulus. What kind of taxes? VAT tax, % of revenue or income? Now VAT and % of revenue like they have in Canada go to the consumer in much higher proportion than a tax based on income. Additionally for those that fancy themselves "investors" if any of your companies has a non-zero cost of the product they sell and would have to pass on an increase in income tax to the customer then the product being sold is by definition not priced at one of the maxima. In other words their pricing is off to begin with if they can just increase the cost (for whatever reason) and not suffer a loss of sales or income. Anyway I didn't realize that most of the posters here were so uneducated. Like I said the propaganda is paramount anymore. A good narative. Facts don't matter.
Actually, in economics the market sets the price of anything and everything. It doesn't matter what the taxes or production costs are. You can try to pass them on but in the end the market says the product has a certain value. You can move along the price-demand curve by varying the price but it is not based on inputs like taxes. Some products may cost more to produce than the market will bear in which case the producer is out of business.
What does happen is that taxes tend to have negative impact in many areas besides price, but they should generally be deflationary in that they reduce consumption and put extra internal pressures on production and sales. It is a prime motivation for moving overseas to reduce production costs...cheaper labor, lower taxes, fewer rules/regs. Look at the recommendation here to head for Singapore. Capital searches relentlessly for its best return.
Methinks that most ZH'er believe that anyone with advanced education in economics has abandoned any and all connection to reality, e.g. Chairsatan Bernanke and his FRB minions.
Thank you Mr. M. for that succinct observation.
Luckily I have never had the benefit of a 300 level economics course, so I don't feel bad when I tell Paul Bog. to 'Go fuck yourself'.
If you examine the post I was replying to, I was arguing that a new toll on a road might very well add to the price of bananas.
Congrats on completing your 300 level economics course!
Now I suggest you go back and do the 100 level English comprehension course.
@traderjoe "and when corporate and payroll tax rates increase, those increased costs get passed on to consumers in the form of higher prices." If he isn't talking about taxes increasing the price of individual goods then he isn't talking about anything at all, which of course he isn't
So if everyone in a town of 30k has $200 less to spend, based only on your 1% salex tax increase, will the consumer's buying power increase or decrease? Add in various other tax hikes, and that consumer would have suffered greater than 1% in their purchasing power. If everyone in the town of 30k residents is now purchasing less at the local mom & pop coffee shop, will the demand for the shop's products increase or decrease? If by some miracle, it were to decrease (heavy sarc), would the coffee shop increase or decrease prices in order to drum up revenues to make up for the lost business? Basic economics dude.
Add in various other factors, including the coffee shops increased input costs, basically across the board (sans employees wages - stagflation baby), and you have a mom and pop shop laying off employees, and closing up shop.
One reason Amazon.com is so popular, is the lack of paying sales taxes (but not in every state), helping to make an item cheaper, and a reason competitors are bitching to all across the nation regarding the unfair advantage Amazon.com has. If items weren't cheaper, why would Amazon's competitors complain?
Trader Joe, THAT IS NOT WHAT he is saying. You could, I suppose, argue whatever you tax, you get less of and therefore prices would tend to rise.
Your arguement is deflationary, not inflationary and so is his; he just does not realize it.
You can phrase anyway you want but if you ask a person how much something costs, they are not going to say "well pretax, this banana cost x and then after tax net was X+T calculated on a percentage basis of sum(ST x PTB)+B=FT". Ever hear someone say that?
Move to a lower COL area if you don't want to pay "taxes" for commuting to work.
You are absolutely correct. There are any number of examples of local drops in sales tax with no corresponding drop in local prices. This was nonsense.
'Any number'? Some examples, please.
Though I guess 'zero' is a number too.
Anyway, saying that any increase in the costs of bringing something to market will ultimately be met by the consumer, is not the same as suggesting that businesses won't take advantage of the 'stickiness' of the public's perception of what items cost, when some of the businesses' costs decrease. Above all else, businesses respond to competition when it comes to pricing. This is why, when taxes go up, it may be weeks or even months before retail prices reflect the rise - individual companies will attempt to keep their prices lower than their competitors until they risk losing actual money.
Furthermore, we are in a broadly inflationary environment (except for things bought on credit). If VAT is reduced by 2.5%, a business is not going to bring its prices down by 2.5% if its other costs have been increasing at 8% per annum.
Of course a business is not going to reduce the sales price of an item. Not with inflation staring them in the wallet. Or, at least, they will not without competition from someone like, oh, say, "WalMart"?
...so you are saying that the price I pay (which includes the sales tax) does not go down if the sales tax is reduced?
It is also not just the taxes that hurt, it is the levels of bureaucracy and regulation in states such as CA that drive folks to do start up companies elsewhere...or out of the U.S. completely. Entrepreneurs get treated as though they were some sort of criminal that must prove their innocence first before being permitted by these gatekeepers to proceed. They are are all anti-business, but they demand their share of the profit...crazy.
Well said. Government writes rules for companies that it has no ownership rights in and has no responsibility for the results. It's a great situation and its intoxicating in its power. Once we become the USSA with another 80,000 pages of regs, 40,000 more pages of tax laws and not the second, but the number one highest corporate tax rate in the world we will see if the modern statist-liberals can produce economic nirvana. Wanna take bets?
Don't forget another 16,000 IRS employees.
Oh, excellent point! They are here to help us, I believe. You would think just maybe anything that comes with 16000 new agents/law-enforcers would raise a few eyebrows...especially since we are not dealing with criminal law. Not these days it seems.
Then why didn't prices go down when they extended the Bush era tax cuts?
Help me out here - are you really this clueless?
You do realize that extending tax cuts is not actually lowering taxes, right? That it's just not raising taxes; i.e. it's not changing anything - right? If no changes is made - then why would this lack of change cause prices to change?
Not to mention - the Bush tax cuts were cuts in income tax, not corporate taxes. So the only "prices" that could feasibly be changed by changes in these taxes are the wages that you charge your employer. Hypothetically they could have changed - e.g. if you all of the sudden were paying more in taxes to the government, then you might demand a higher salary from your employer, in order to maintain the same income level and therefore the same standard of living. Good luck with that though. The effect of that would be (is) to push jobs overseas.
Don't confuse the hyperventilating trolls with data! Like pouring a gallon of water into a shot glass
The Bush tax cuts were a big crock. You cannot lower taxes and raise spending. The money has to come from somewhere. When the government raises spending millions more people go on the government dole, its gets harder to hire, capital is absorbed, productivity falls, and inflation goes up. Only the rich benefit from inflation.
Might I offer the alternative, that the spending is the "crock". If we actually matched taxes to spending...which would be fiscally responsible, we would crash the economy. Lowering taxes ostensibly allows the economy to recover and then later raise tax revenues. However, spending has always outpaced revenues no matter how good the economy. Even during the few budget surplusses it was a green light for revved up spending, not responsible fiscal action.
Strictly speaking, inflation benefits all debtors, particularly those with fixed debts as inflation accelerates. All modern governments are huge debtors therefore central banks like the Fed always favor inflation. The rich are in a better position to take advantage of it, but being rich puts you at an advantage in all situations, inflation, deflation, stability. That's why its good to be rich!
Unions always give back extra money, right?
If you receive a pay increase, and your Unions dues are based upon your hourly rate ,you pay more to the Union!
Every time a taxpayer funded government employee gets a raise so does the Union.
Since the Bush era tax cuts why has SEIU's revenue gone up?
"Because your logic is flawed. There is no direct connection between prices and taxes other than narrative."
I tried to come up with something witty to say but my teleprompter is broken ;-)
Really Paul, A small business fighting for its life would not use that as a draw? A large corporation would never use that small decrease to increase its sales by cutting prices it always SCREWS SOMEONE. Tell you what paul you take your chances with the Government and I will take mine with corporations I have a choice to do business with. And by the way, how in the hell does Bush dropping personal tax rates have anything to do with this article about primarily sales taxes? You did read it right? Tyler I beg of you, my kingdom, my horse for an ignore button..
....let me second that...where did these cretins come from?? Must be members of some public employee union...
If taxes don't affect prices, then it's free money. Raise the sales tax to 1000%, fund the government, pay off the deficits. Now, can you see any problem with this?
Losing, duh.
Well hell, we tax our corporations at 35% but they pay nothing. Like GE. What a crock our country is.
Yeppers, overtax XOM and leave GE be! They do God's work, even if it doesn't help you get to work.
http://www.truth-out.org/the-new-american-dream68847
So what? Businesses don't pay taxes, they merely collect them. If GE paid out $100B in taxes, where do you think that money would come from? The consumer, maybe? Who just happens to be you and me and him and her and...
No, businesses pay the highest tax rate in the world, remember?
Perhaps rather than passing on the costs, competitive pressures would force the corporations to downsize the profits of the owners and executive employees if they paid their taxes.
Doubtful. Taxes are like an operating cost on a business. Like rent or utilities, taxes are essentially just protection money that every business must pay in order to exist. Raise those taxes and it gets passed right along to the customer. As a business owner, I don't much care what the tax rate is .. 1% or 50% .. I'll just pass the cost right along to my customers.
But why do you care how much GE pays in taxes anyway? Suppose GE paid $100B or $1T or $10T in taxes. That money would simply go into the vast black hole of government spending. I think the mistake you make is to think that your quality of life would improve somehow. Suddenly you'd have great health care or a 20-hour work week or a nice house to live in, if only those evil corporations and greedy rich people would just pay their "fair share"? I doubt it. Your life would be no better, and you'd find a new excuse for it.
While I don't fault your conclusion to your argument regarding government spending going up with more tax revenue, I do fault your reasoning for GE not paying any taxes. GE has gotten government contracts and as tax payers we all know how the agreements are drawn up. If my tax dollars have to go to subsidize a company, I believe they should pay their fair share of taxes. They could also get rid of government contracts and subsidies, but we both know that will never happen.
It was nice of the Tea Party to vote for their pork farm subsidies. Whatever happened to the free markets they referred to when our "socialist" President passed the health care legislation (which I disagree with because it is basically corporate welfare for insurance companies).
I am not fond of GE but I have not had a look at their tax returns for the last several years to pass judgment as to right or wrong/gaming the system. If a business has one to three years of losses they can be used to offset profits from a future year. I think it is only fair that when a financial loss has occurred you can bring the loss forward into a profitable year for tax purposes.
Does any one have insight into the moral legitimacy of GE not paying taxes? Even though they polluted part of the county I live in there is enough crap to be had on GE with out resorting to repeating flimsy evidence.
They have almost 1000 people employed in tax avoidance. They are the most aggressive corporation in avoiding taxes. Maybe because their profits from the finance division are somewhat of an illusory concept while cash flow is always an operating term. If you have positive cash flow , life is good, if you don't it you die. Profits? Doesn't matter with Uncle Sugar having your backside. "It's just a Goddamn piece of paper", you know, like the constitution
There must be a bonus for sneaking key buzzwords and phrases into your posts. I'm getting these choice specimens stuffed and mounted: 1-"Fair share of taxes" 2-"Employed in tax avoidance" (is it a sin?) 3-"aggressive..in avoiding taxes"
Because they donated large amounts of money to O and other politicians, and because they hire ex-govt bureaucrats to help them beat the system--GE is virtually a subsidiary of the O administration.
Oligopolies in the process of metamorphosing into fascist kleptocracy's always have corporations with favored status. Pull Mussolini off that lamp post and loosen that rope, he can explain it..
Singapore....if I was 30 years younger....I'd go.
Better yet, why send Barry, Benny and Timmy and the entire cast of Fools on the Hill, DC instead.
We could hit the reset button and try again.
Riduculus concept of inflation. Taxes are deflationary.
The funding of schools and roads, etc. are not wasteful economic endeavors. Oil going up because the world is using more than it can produce is inflationary.
Tax breaks are fine but if everyone gets a tax break, doesn't add up. The extension of what is good for business runs into what is good for a nation and human decency.
But since this is advertising, one musn't be too critical.
Name a public school worth funding.
++++++ couldn't come up with one.
Are you high? Lower taxes + smaller gov't = epic win for EVERYBODY
oldmanagain you and your bluehair friends are safe. Your social security checks and medicare won't be touched. Go away.
I'm for public schools but it should be run by each state, not the federal government. This policy has resulted in huge amounts of freedom lost ast the state level. It should also be a privilege rather than a right, the current babysitting model is an embarrassment.
You are basically correct except that schools should be funded and run by the local community as they were earlier in US history. My grandfather went to school as far as the third grade, then successfully built and ran a business. He supported 16 children.
The price of something going up is not in and of itself inflationary. Most people think that is it, but real inflation is actually a monetary problem of too much currency chasing the same or fewer goods. If the amount of money in the world stayed constant, rises in the value and price of oil will be exactly offset somewhere else. In fact, deflation would be the norm as human productivity rises. Deflation favors savers.
I suggest all government spending is wasteful in that government does not actually know the proper price of anything. It can only look at the "free" market and guess at it. We don't know the real value of schools and roads because they are not privately built...in general. We don't know the price and value of teachers, police or anything else, either.
Much of the blame for rising prices has rightfully been levied on the uncontrolled expansion of central bank balance sheets-- the US Federal Reserve, for example, created more money in the last two years than it had created in the previous 200.
Let's call it what it is. Uncontrolled printing of FRNs in an ultimately futile effort to keep bankers in profits and bonuses, keep their gambling casino in operation, and keep the federal government spending spree going.
And no it may not end anytime soon, the Fed can keep up this madness until America and the world is flooded with FRNs and they become like toilet paper, completely worthless.
central bankers deserve to be shot dead
Funny, I just read the most beautiful little essay that seems strangely apropos:
http://www.truth-out.org/the-new-american-dream68847
Thanks for the link!
Meh. Tiresome socialist claptrap, just like you'd expect from that source. They get it partly correct, but then veer into the usual socialist cul de sacs.
When are we going to fess up that the old labels have lost their meanings?
only socialists say that. If it quacks like a duck and looks like a duck then it is a duck. You socialists are the ones trying to blur the meanings of words and say that "old labels" are irrelevant.
The troll is back! I thought you fell on Narcissus' Sword there a while back.
Depends on which labels you're talking about. "Democrat" or "Republican" have definitely lost their meaning. "Socialist" and "Communist" still mean exactly what they used to mean.
Last I knew they were defined during the Cold War. That seems clear when I hear people using them around here, at least. At least you're not a progressive, eh?
When labels through long experience become arrows of truth pointing out the essential blackness and rot of their souls is when socialists and communists always question the veracity and accuracy of language.. Let me guess, time for a new paradigm, the old labels do not encompass your version of truth the one you would like us to embrace yet again. There is nothing new under the sun Bob, and I have watched the antisepsis of the sun for so long..
I'm not a socialist. But I can't help but notice what we got now is a Capitalist disaster. Time to stop blaming the commies under the bed and man up to the truth of it.
That's gotta be the reason for all the finger pointing at socialists. Nobody could be so stupid as to rationallly think we've got a socialism problem.
Well, Bob we seem to be running out of other peoples money at a quickening pace that seems as good a definition of socialism run amok as any.
Good enuff for you, apparently. Best of luck.
Ha, yes, good enough for you and I. My eye will be peeled once the fun starts.
we're not socialist? So how much bailout/stimulus money did you receive? Our problem is crony capatitalism, our system does not work unless laws are applied uniformly.
Man, you really, really haven't been paying attention the past few years have you. Or maybe it's just that your critical thinking skills are stunted. Capitalism is 'free markets'. We do not have 'free markets'. Ergo, no capitalism. For the hundredth time (though apparently the first for you), what we have is 'corporatism' or 'fascism' or some variant thereof.
If you want to defend socialism, fine. But what has been happening is government taking wealth from the people of the country, via both taxation and inflation, and redistributing it to those it deems worthy. Ostensibly our government is democratically elected, ergo the beneficiaries of its largesse by definition receive that redistribution of wealth to the benefit of the country. Which, by definition, is a form of socialism. QED
What we have are capitalist uber-criminals. You people seem to have "socialist" branded into your brains in the place where words for "evil" are normally stored. You look around, see that the government--which has been taken over by the capitalist brand of monsters--is an accomplice in the racket by which we're being robbed and instantly think that proves the case, "QED." Was Madoff a socialist?
It's the insane lengths that "capitalists" are going to to protect their precious fantasy world, where "good" is a synonym for anything labeled "capitalism" and if something is not good, it must be socialism. Let that fantasy go. This is a distinctly capitalist nightmare that has been thrust upon us.
That's no defense of socialism. Just simple reality.
Nice that their taxes are so low, but isn't Singapore virtually a dictatorship?
Better buy your hash from a reputable dealer, that's for sure. And don't spit on the sidewalks.
Your version of truth would certainly earn the cane.
Nah, just score from the guy who runs the escort service. He won't rat you out, I bet. Might even smoke it with ya, even.
It only seems that way if you are caught spitting on the street.
(Bob beat me.)
Yeah, isn't that the place where they cane people for minor offenses?
~Misstrial
I like cities without ugly graffitti and amateurish ugly street murals from ghetto types. Singapore sounds like a great place. At least they have some pride in how it looks and don't let it look like the third world. American ghetto types ought to have the same pride in how their cities look, or at least be caned if they have a can of spray paint on them and gang dress.
I see you're still working. Good thing you never say that shit to their faces when you're working at your other job. Pathetic.
I can see why you like Socialism so much. The money flows stolen from my wallet into yours. Great for you, not so great for me. New avatar pls.
No, definitely not a dictatorship. Absolutely tough on crime though.
City's a lot of fun, although pretty expensive. By far the cleanest city I've ever visited.
In Singapore they steal sand from neighboring countries to make more land!
http://coastalcare.org/2010/08/more-about-malaysian-and-singapore-sand-i...
One well-placed earthquake and the place becomes a big pool of quicksand.
TPOG
"central bankers deserve to be shot dead"
...You forget Congress has been selling out to bankers and big business since 1913.
Well, Chucky Schmucky has sold out to Soros, so is that big dickheadedness?
automatic weapons are very easy to obtain---those fuckers better have a plan
We labor for the state, comrades. Work harder!
Hope the follow-up deals with residency, path to citizenship, you know, the important shit for getting out of Dodge.
Well then just shut it down...
"On Tuesday, principals on both sides spoke as if a shutdown wasn't just inevitable, but imminent. Cue finger-pointing..."
http://tpmdc.talkingpointsmemo.com/2011/03/democrats-and-republicans-pre...
Finally some good news...
What if the federal gov't shut down, and nobody cared?
No one would care except the 40 million people on food stamps, (some of whom have guns) most would be hungry in 3 days time.
Then very quickly you would care
Fair enough. How about we keep the food stamps (for now), but just furlough 90% of the federal bureaucrats?
How will senior citizens get their monthly checks from SS?
Who will fight and pay for the forest fires?
What about those 3 wars we're in?
Don't forget the people on govt. insurance.
Don't forget the subsidies to the farmers throughout the US who get paid to not farm.
And please please don't forget about the tax collectors, auditors, US attorneys, and Judges.
Go ahead congress don't pass a budget, stopgap spending measure, or pass legislation to increase the debt limit.
Well Mr. Anderson, we could wipe the slate clean, get a fresh start. Perhaps once you fully describe the armageddon the Government shutting down will be we will all line up for our microchips and forehead tattos that guarantee eternal happiness, yes..
I'm sure sure if any of those things I put down equal armageddon (many would say it would be a good start)
Whenever a government cannot produce a profit on the natural resources it owns it is time for a revolution. (the last year the Dept of Ag created a profit for the federal govt was 1994).
RFID tags are alot cheaper than microchips.
I would be dancing in the streets if I could make that on my money market funds right now.
Bravo! No-one ever factors taxes and government imposed services in the inflation rate. My water/sewer bills have doubled in three years. Sales tax at 10%. Building permits up 35%. Parking meters 100%. Tuition up 70% in three years. Fees etc. etc. Living in Southern California is hard. Fortunately we pay handsome welfare, enormous public servant wages and lavish spending on the indigent, criminals, and illegal aliens.
Move, fool.
While it is allowed. Lots of CA plates here now in SW FL. (Them plate holders haven't figured out it's cheaper to register here.)
when california, illinois, and new jersey turn into greece it will be a great example for the rest of america. Move out now or find ways to avoid taxes anyway you can. finding five dollars in tax avoidance is a small victory. Take those small victories whenever you can. The sooner we turn california into greece the sooner socialism will be discredited in the USA. If the california collapse happens quickly enough it may change enough opinions in the USA that we might be able to avoid the same fate for the entire country.
Taking out the 3rd largest country in the world dind't do the trick on the stock market-
California (5th largest GDP) in the world going into default-
That could tip the scales.
Really though, how could you be on ZH and live in Southern California? I dont care how many guns you have and how much food stored up it still wont be enough.
California is the best place to be when the dollar collapses and the oil runs out. We can live quite happily without heat. The climate is balmy.
Northern CA sure, they have enough water and produce enough food. Southern CA produces hot blondes and sun tans.
So find a Tan hot blonde, and export her somewhere that gets 20-30" of rain a year and produces an abundance of food.
"Southern CA produces hot blonde..."
...and porn movies that keep the SEC occupied, not to mention the intellectually challenging fare coming out of Hollywood...what would ever do without So. Cal.????
I live in a small town in NorCal and would like to see the state divided in half...then we'll sell our water to the folks in LA...
Northern CA, Eastern WA, OR, ID, MT, Utah, an CO. would make a great productive Country.
Your ass will be rendered... for the oil.. Spermaceti anyone..
.
Tyler,
We know your busy but wouldn't a great article be-
Compare and contrast-
Greece, Ireland, Portugal
to
California, New Jersey, Illinois
Get out while you can.
Income taxes are a ripoff. If it were me the first $1M/yr would be tax free. Anyone with over $1B in assets would be burned at the stake.
Sounds good to me. Lots of Dems need to go up in flames. You feel me, Kerry?
Speaking of taxes, my 3 month nightmare ended today. Will cost me $500 bucks or so on the friend discount for maybe $110K income.
This has to change. Bachmann in 2012.
Fukking wash sales, what BS.
How can 500 bucks be a "fucking nightmare?" Sounds like you got off easy with the IRS.
It's the 3 months getting, and waiting, for all this shit the IRS requires, and $500 for protection money paid to a tax preparer. Oh, why bother. You are a destitute moron!
Everybody hates paying taxes... but what few people realize is that tax hikes fuel rising prices. When payroll tax rates, import duties, corporate profits tax rates, sales tax rates, etc. increase, it's always the end consumer at the cash register who gets stuck footing the bill.
Now you understand how the massive expansion of the food stamp program is more of a stealth entitlement than a means to thwart the epidemic of starving Americans:
Get as many Americans voters dependant on the government as possible then tax and inflate wealth in a downhill direction. Food stamps and similar government assistance will be COLA'd and never allowed to be taken away while taxes and inflation encounter little resistance.
The bottom and the top against the middle baby. Get rich or get on the gravy train fast because time is running out for the American middle class.
+1000 internets
You are wise to their plan. Their agenda is to destroy the american middle class, which represents the last real obstacle to total planetary domination.
And how much is sales tax on food in most states? Bet you didn't know that average SNAP benefit averages about $133/ month and is set for automatic 30% reduction in 2013 as it was boosted as part of TARP.
Where do these bozos come from, Market Ticker?
Anyone else get notices from their HSA that 'if you made contributions to your HSA, we will be sending out statements around May frigging 31st'?
Beyond the 30 day extension, in case you always fail the captcha.
dont forget those damn PROPERTY TAXES !
So if I register my business in singapore and have a singapore domain for my web address and my business is purely online, then I can avoid taxes on the first 70,000 of my foreign income? Sounds like a great place to set up internet businesses. I hear Vanuatuu is pretty good too.
Vanuatu has crappy internet. My sis was just cruising there.
Also this... (from wiki)
"Vanuatu has a population of 221,506.[26] Males outnumber females" - so that's an INSTANT fail...
lol, spoken like a true meat eater!
Lee Kuan Yew, the authoritarian and despotic founder of modern Singapore who counted among his greatest admirers, Henry Kissinger and Richard Nixon, once famously opined that "The expansion of the rights of the individual has come at the expense of orderly society". Untiringly critical of Western society, LKY has suggested that democracy will just not work in Southeast Asia. And Singapore's economic miracle is largely based on not only an authoritarian police state but on the dictatorial nepotism, preferential treatment and favoritism dispensed by the extended Lee family. It is no wonder that the dubious expatriate Mr. Black, whose insufferable elitist pedigree and disdain for the plebeian confines of the US has often been on display here at ZH, would, like so many of his fellow haut monde globe trotting profiteers, find such a congenial atmosphere for his brand of economic predation in the kind of neo-fascist business model which he so pompously and hypocritically excoriates in the US.
And NYC is great? What's yer point?
Fine to bash and trash, but you live in Detroit?
Chicago?
Happy Fran?
East LA? Any of those places where the people are so dumb, the dead voters overwhelm them?
Pelousy is not despotic? Reid? Chucky Schmucky that takes his marching orders from Soros?