Perry Glasser

Archive for the ‘Politics’ Category

MILLENNIAL WHINING

In Economics, Economy, Millenials, Political Economy, Politics, SOCIAL MEDIA on June 2, 2018 at 10:45 am

The jobless rate ticked own in May to a seasonally adjusted 3.8%, the lowest since April 2000…The last time the rate was lower was in 1969.
–Wall Street Journal, June 2, 2018

Since 1969?

Dollar$ turned 21 in 1969.

The good news reported by the Labor Department includes rising wages among all classes of workers irrespective of race, gender, or education, but Dollar$ could not help to think of Millennium friends who periodically flood social media with bitter attacks against those Baby Boomers who came of age when life was so easy, and who then spoiled everything for everyone ever after.

Dollar$ as a matter of disclosure is happy to reveal he is one of those Baby Boomers, and Dollar$ freely admits the rise in price to thrive in in the American economy has not always been even—the rise in cost of housing, education, and healthcare as percentages of incomes is staggering—but Dollar$ takes perverse pleasure in noting that there is simply no longer any contemporary rationalization for staying at home and whining about it.

Whining most often to each other about the unfairness of life is accomplished by cell phone (A Boomer Innovation) is, how there is never enough time to compete on the Internet (ABI) with video games (ABI) on their flat screen hi-def TV (ABI) and which leaves not much else to do except participate in Hook-Up culture enabled by easily obtained and easily used birth control (ABI). Leave alone the more significant cultural changes in Civil Rights, Women’s Rights, Voter Registration, Marriage Equality, and a half-dozen other causes, all essentially accomplished but under perpetual attack by troglodytes who long for an America that never was.

The price of social freedom and progress has always been vigilance.

But the good news means there is no excuse not to go forward. Sorry we did not get to it, but it is time to roll up your sleeves, kids. C’mon, my grandchildren are counting on you for:

  • Silent jet planes,
  • Genetic cures.
  • Economically viable renewable energy,
  • Relief from America’s oil, concrete, and rubber infrastructure.

And, yeah, like Captain Jean-Luc Picard, after some time on the holodeck, Dollar$ wants to kick back with refreshment prepared by voice-recog: “Computer, Earl Gray, hot.”

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WALL STREET PERVERSITY

In Business, Economy, EDUCATION, Finance, FINANCE FOR THE CLUELESS, Politics, Wall Street on February 9, 2018 at 5:26 pm

Dollar$ notes again that the financial community seems to be insane. Buccaneers and Wizards confound the simple Citizen who needs a money harbor other than a pillowcase. Until someone invents bedding that pays interest or dividends, that is likely to be a bad idea.

screwed1

Citizen

You may have read that the markets are down because of too much good news.

It’s true.

January 2018 saw a market run-up of breathtaking scope. The Weasel-in-Chief was smugly taking credit and taking Olympic Gold for World’s Worst Comb-over (Orange Division). Kids on the street were selling their bicycles and holding bake sales to pick up some bitcoin, wait a day or two, and then cash in expecting in a day or two to have enough money to buy a private Caribbean island that would be closed to those short-sighted ever-selfish Baby Boomers who ruined the Earth by inventing cell phones, expanding civil rights, and creating cheap birth control that begat Hook-Up culture, all while stupidly neglecting to shape a world where no one would have to work.

Mean or what?

WHEN GOOD NEWS IS BAD NEWS

The good news that rattled the markets is that more people are working and that the people working are earning more money. Wall Street, naturally, near soiled its underwear.

The bad news was that many people persist in believing that economies are a zero-sum game. If the notion of I win, you lose! rules the markets, what could be more awful than Citizens getting a bigger piece of the pie?

More people, more jobs, more money, that’s bad.

R-i-i-i-i-i-ight.

 

CITIZENS & TUMBLING STOCKS

In Business, Economics, Economy, EDUCATION, Finance, FINANCE FOR THE CLUELESS, Personal Finance, Politics, ROBERT REICH, SOCIAL MEDIA, Wall Street on February 5, 2018 at 7:27 pm
jimmy-stewart

investor

Dollar$ readers have asked for a comment on the recent path of stocks falling off a cliff. Though Dollar$ seldom references perturbations in the market, in this case he will make an exception because any number of people with brains of tapioca or in possession of advanced degrees will point to this event to declare it political, a referendum of sorts on Donald Trump for whom they hold unsustainable rage.

 

THE AXE OF RAGE 

Rage as a political stance is unsustainable because it consumes its object as well as those who revel in it. We grind that axe at our own peril.

That won’t bother pundits such as Robert Reich at Berserkely. Expect his gloating to surface in a day or two while his cadre of unsalaried graduate student do his work for him.

After all, Reich persuaded thousands of Facebook followers that Spring rain, the demotion of Pluto from planet to rock and back again, and your most recent dose of athlete’s foot, were all ploys by the rich to separate you from your money because there is no bottom to the depth of their greed. (Except for St. George Soros, who sends wheelbarrows of Canadian cash to political causes in the United States out of simple generosity, something that most of us would find curious if the cash came from Outer Slobbovia or Russia.) The Professor has yet to mention the President’s promise to go after Big Pharma or his championing “the right to try” to give the sick access to medications stalled in the FDA’s long system for approval. How could Reich do so? His followers might dial back their rage, and then who’d buy the Professor’s books, subscribe to his videos on Netflix, or line up to enroll in his one class per year in a lecture hall packed with the beneficiaries of privilege, those students at Berserkeley who on cue wildly applaud before marching to deny free speech to someone else?

To be sure, Professor Reich will neglect to mention that the trillions lost on world markets in the past few business days have mostly been lost by the rich. Who did you think owned the shares of companies? Your barber?

Also, make certain you know, that Dollar$ believes our President to be at base a lout, a racist, sexist, and probably a compulsive adulterer who happened to revolutionize American politics by seizing on social media as a means to create a bridge between himself and voters when his own party and the American press gave him all the chances of a balloon in a pin factory.

Benjamin-Franklin-U.S.-$100-bill

Chastity?

None of that, by the way, makes him unfit to join the ranks of John Kennedy, Franklin Roosevelt, Dwight Eisenhower, or Bill Clinton. There were many others; the folks who brag about zero tolerance for white male sin remain eager to rewrite history by expunging ordinary men from the presidential rolls. God help us if they figure out what the Founders did with their time when separated from spouses for months, and that rascal, Benjamin Franklin, was not know for his chastity.

Fortunately, The Donald did not run for Pope.

STOCKS

Dollar$ is happy to report the sky has not fallen, at least not in my neighborhood. If Jemima Puddleduck races past your front door, Dollar$ urges you to unwrap that shotgun you received as a gift from Grandpa. Go bag yourself an inexpensive cheap chicken dinner.

Responsible financial advisers will tell you to do nothing: Dollar$ agrees, unless you have a working crystal ball in which case Dollar$ would appreciate a call. All the elephants could not get through the door without the house collapsing. That’s what happened today.elephants

DECISIONS

What now? Better to ask: Where would your money be better off?

The world economy is peachy.

The American economy is also peachy, showing healthy signs of continued growth.

Do not confuse the economy with the stock markets. After a run-up of 21% in a year, market algorithms were bound to get nervous.  (Algorithms don’t properly get nervous, but the notion of market sentiment is a joke when upwards of 90 percent of all market transactions are conducted by computers.)

The American economy is in danger of suffering wage-inflation. Prices will rise because Joe Doakes, his cousin Joe Six-Pack, and their cousin, Jane Doe, are earning more.

O, the Horror! What will Reich say if people are earning more?  What fraud is being perpetrated that will need a decade to play out?

RELAX

The past week has seen a drop of 5 percent. More is coming.

Bear in mind that historically, a 7 percent gain in a year is good news. If after the carnage we saw today and can expect for a few more days your 401-k, your kids’ 509, and your savings ratchet back to a “mere” 12% annual gain, try not to swoon.

Stay  the course. There are bulls, there are bears, and there are pigs. People who try to time the market—that is, sell now with the hope and expectation of buying it all back when things have settled—are pigs , and like pigs will be slaughtered.

REICH AND THE RESISTANCE

In Economy, Politics, ROBERT REICH, SOCIAL MEDIA on December 28, 2017 at 2:14 pm

Dollar$ apologizes for departing from its usual mission to analyze finance and instead articulate a political opinion. Lord know we don’t need another internet opinion, opinions being like rear ends—everyone has one, and everyone is sure theirs looks and smells better than anyone else’s.  But it is time Professor Robert Reich be called out. Enough is enough, and in this case enough is too much.

Professor Reich professes at U Cal Beserkely where California in 2016 paid him $263,000 to teach a class or two each year—that’s about $25,000 per lecture. That arduous duty is assisted by graduate students, also paid for by the U Cal system. That leaves the former Secretary of Labor plenty of time for speaking engagements at $40,000 a pop.

It’s not hard to be productive if you have a crew of graduate teaching assistants in your personal blog mill. Professor Reich produces 3 to 5 social media posts and short videos per day  and peddles a series of lectures on Netflix.

He lectures on wealth inequality in America.

Dollar$ is not waiting for the professor to start turning back his salary to Californians.

Professor Reich had high expectations that he’d return to the corridors of power with the elevation of Hillary Clinton to the presidency. That presumption afflicted plenty of coastal intellectuals who thereby fumbled the election by neglecting to campaign in several swing states such as Ohio and Wisconsin, places former President Obama won, twice.

In Reich’s case, the shock of loss has precipitated two responses:

  • Reich wrote a book called Saving Capitalism, which at his levels of compensation suggests the question “Save it for whom?”
  • Reich has positioned himself as the leader of The Resistance, the enemy being President Trump.

In the pictures above, can you guess, which is the real resistance fighter?

Dollar$ is no fan of Donald Trump, who in his personal history proves himself to be a lout and whose public utterances and Twitter-babble are a national embarrassment.

That said, Dollar$ points out to Reich and others that history is non-malleable fact (except at universities where professors who scoff at notions of “fake news” also posit that we live in a world where Truth is a matter of perspective).  Importantly, History is not a metaphor. That stuff happened to real people, and it was often less than pretty.

No one doubts that all internet arguments devolve into comparisons to Hitler, but until Professor Reich and other “resistors” show evidence that American citizens in the 21st century are being tortured and strangled with loops of piano wire, can we hope to no longer see a reference to the Resistance in WW2?

It’s not fun; it’s not persuasive; it’s not appropriate. And other than being a hope concerned citizens will send Professor Reich a few bucks, Reich’s Resistance has absolutely no program.

All the posture does is insult brave men and women whose sacrifice and courage should not be trampled for a cheap political point.

 

TAXE$ AND COMMON CENT$

In Business, Economics, Economy, Finance, Personal Finance, Political Economy, Politics, TAXES on December 21, 2017 at 4:24 pm
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SCHOLAR OF THE SUBJUNCTIVE

Dollar$ resents and excoriates finance writers who write in the subjunctive mood. For readers who stopped paying attention to their English teachers in the 8th grade, that means a statement that is conditional. Correctly constructed, the sentiment expresses and a condition that is either not yet true, will never be true, or the speaker wishes were true followed by an outcome that is also not true.

 

If this be treason, make the most of it! – Patrick Henry

In our times, the greatest use of the subjunctive mood is for Romance, handy for lovers unwilling to commit but nevertheless compelled to express what resides in their hearts. Is there a better love song than If I Loved You?

Many speakers flummox the niceties of this important use of mood, and while it is not Dollar$ purpose today to deliver a grammar lesson, he earnestly hopes readers will be afflicted with the dry heaves should they come across ersatz prophets who preserve deniability and protect their alleged expertise by abusing the subjunctive mood. Yes, the stock market may go up, a bold prediction that allows deniability. It may also go down. Dollar$ also notes in passing that Patrick Henry was not speaking archaic English when he addressed the Virginia House of Burgesses, but was properly employing the subjunctive mood of the verb to be. If you still don’t get it, consider that the Cowardly Lion of Oz fame sings “If I were King of the Forest.” Now you know why Bert Lahr never sang was.

THE 2017 TAX BILL

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SOCIAL MEDIA EXPERT

Dollar$ has until now said zero about the proposed tax bill because it was proposed. Details were open to negotiation. That, however, did not prevent the doyens of social media to claim the sky was falling and suggest that passage of the tax bill would end civilization as we know it.

FACTS IS FACTS

The corporate tax rate has dropped from 35% to 21%. Lest you read Robert Reich, the former Secretary of Labor so startled he is not advising Hillary Clinton in the White House that he has taken to Facebook to lead “The Resistance,” let’s note that despite Professor Reich this tax cut is does not pick the pockets of the poor to give money to the rich. After all, 35% of nothing remains nothing, not coincidentally the amount of taxes paid by Apple Computer and many other multinational American-based companies that have disincentives to bring their profits back to American shores.  The new tax law is a hope to repatriate funds, an overdue program first called for by John F. Kennedy. Short version: US corporate taxes now align with the rest of the industrialized world.

Apple and other corporations can bring billions back to our shores and suffer no financial penalty for doing so. The Tax Policy Center noted in 2014, “Despite its relatively high corporate tax rate, the United States raises slightly less revenue from corporate income taxes as a share of GDP than the average of other countries.”

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Facebook economists who took time from photographing their cats and their breakfast (or cats having breakfast) have been told repeatedly that Trickle-Down Economics does not trickle.  Dollar$, however, notes that several organizations have as of this morning announced raises for line workers and hikes in their minimum wage. Dollar$ is certain those responses are due to more than a rosy picture of future profits precipitated by a tax cut. Fact is, labor is getting scarce; like other valued assets, if you want to keep trained and skilled workers, you have to pay for them. That’s how markets work.

The Koch brothers may have a social agenda, but Facebook economists smugly predicting that the new tax codes will so reduce revenue that Social Security and Medicare will have to be sharply reduced may want to note that neither of those programs is funded out of general revenues but from separate trusts funds. That’s why your annual pay stub has separate boxes for Medicare and Social Security, Binky. They ain’t general revenues. Dollar$ bids good luck to any weasel who lays a hand on those monies, but since the first rule of weasel life is to remain a weasel, Dollar$ is losing no sleep over that possibility.

Similar dire predictions about how the poor will suffer because so many itemized deductions are now disallowed stagger Dollar$ for the hypocrisy or ignorance of how taxes work.

Itemized deductions are

  • also known as loopholes
  • seldom used by citizen taxpayers who do not own a home

LITTLE OLD LADY WHO LIVED IN A SHOE

woman-livedinashoe

TAX PLAN BENEFICIARY

The Little Old Lady who lived in a Shoe had so many children she did not know what to do will, if she itemizes, will get $2,000 per kid where she used to get $1,000. Unless her shoe is worth more than $750,000, her mortgage interest will remain a deduction. Chances are, however, since more than 60% of all taxpayers already use the Standard Deduction, the Little Old Lady will avail herself of that tax simplification because the SD has near doubled. That is, should she choose to itemize, she’d be a damned fool to do so unless he has more than $24,000 in deductions, something highly unlikely for any who works for wages.Look, that redoubtable working family never paid taxes anyway, and at year’s end looked forward to cashing a tax refund check, the sum of all that withholding tax. Under the new tax plan, her refund will indeed be less because week to week and month to month the Fed will be withholding less of her money. Maybe she can build an addition on the shoe, a playroom in the heel, perhaps.

If any of her kids are planning college, despite the dire warnings of Facebook economists, the deductibility of tuition remains untouched.

So do her medical costs above a certain level—the same as the way things are now.

FLIES IN THE OINTMENT

Okay, Dollar$, a few of you still awake might ask what happens by 2028? Don’t these individual tax breaks phase out? That’s when we’ll be screwed, right?

Dollar$ asks the professional pessimists where it is written that a Congress controlled by Democrats in, say 2024, can’t tweak or change tax law? We change appropriations annually (it’s called a budget).

That is to say, Binky, if you think it is in your best interest, vote your convictions, but stop screaming like Chicken Little. Dollar$, you pestiferous fool, this tax law will raise the deficit!! We are going to hell in a handcart!” (Be careful though, you may start to sound like a Republican advocating fiscal responsibility.)

We have for a decade endured GDP growth in the 2% range, and we hunger for greater. Three percent is not unreasonable; up around 4% you can get a nosebleed and bet we are losing ground to inflation. But should the economy grow more quickly than it has, the deficit goes down. Bill Clinton demonstrated that by riding out Ronald Reagan’s tax cuts.

A country near 100% employment can afford a few risks, and if for a few years we put money in the hands of citizens, should we sweat it?

 

 

$$$

ZERO-SUM TAX POLICY

In Business, Economics, Economy, Political Economy, Politics, TAXES on December 12, 2017 at 12:52 pm

Five players sit down to play cards, poker for example. Each brings $100 to the table, and because of a peculiar tradition of the Dollar$ Casino, no player is allowed to introduce additional money into the game. If one player has sufficient skill, after some time that player will have $500 and the other four players will have $0.

That’s a zero-sum game.

In the social realm, that’s another way of saying that no player can be allowed to accrue more wealth without a second player becoming poorer.

This is assuredly NOT how the economy works, nor can it be the basis of Tax Policy. Perhaps for the simple-minded who find their checkbook to be an overwhelming problem in higher math, but let’s hope that political and economic policy are not tailored for the least able among us.

THE ZERO-SUM ECONOMY3032348.large

In reality, players in a card game can bring welcome new money to the table by:

  • dipping into a vault where old money has been snoozing,
  • innovating when some whippersnapper creates new
    • logistics (drone delivery, anyone?),
    • desirable products (cats do love their roomba rides),
    • organizational efficiencies that squeeze every nickel out of every process

On the Left, the “I don’t got it and you do so you must give it up” social justice warriors are out there, demanding that your children have to split up shares of an ever-shrinking pie. On the Right, the tax proposal now undergoing reconciliation between the House and Senate limits Research and Development tax (R&D) credits out of some misguided effort to cast a political illusion of “fairness.”  Fairness in tax policy usually means “the other guy should pay more.”

Dollar$ readers with a lick of sense will see this for what it is—an attempt to disallow new money to be brought into the game. Dollar$ is no champion of trickle-down economics, but hopes we can all acknowledge that faith in the future is not blind faith, but a realistic assessment of economic history. If it were not, Malthus would have been right and we’d all have become cannibals by now.

AN OBJECT LESSON

Twenty years ago, the world was supposed to be out of oil by now. Petroleum cartels (OPEC) were supposed to have sucked up all the money in the world. An entire genre of popular films was developed depicting a desert world where fuel was so scarce that warlords took women, water, and weapons based on how much fuel they could steal. Mad Max was a nightmare born of shortages and the lurid fantasies of adolescent boys.

If tax policy had been based on that scenario, and gasoline taxed to conserve an ever-diminishing resource, the cost of gasoline would today be sky-high instead of the roughly adjusted for inflation stable price of the past 25 years – the sole exception being those years when OPEC states manipulated prices by manipulating supply under the false impression that no innovation could ever occur—which it did.

OPEC’s hold on the world economy was busted by hybrid cars and oil from shale extraction coupled with the discovery of 80% of the world’s accessible shale in the United States. It may not be clean and it may not be pretty, but after the picketing is done, you can be sure some whippersnapper will find a way to make it prettier and cleaner.

THE R&D TAX CREDIT

Let’s keep the whippersnappers in business!

 

 

 

 

WHINING – A HOW-TO FOR MILLENNIALS

In Business, Economy, Political Economy, Politics on December 9, 2017 at 2:26 pm

One of the more frequent themes Dollar$ reads on social media is the ongoing complaint that the generation born between 1945 and 1970, those rotten Baby Boomers, are a bunch of louts who deliberately loused up the economy for everyone who came after them. Selfishness is something you develop by smoking weed through a bhang and

HENDRIX

SELFISH BABY BOOMER

listening to Jimi Hendrix. If they would all only die, housing would be cheap and jobs would open, easy, high-paying jobs with benefits that require no experience.

This theory explains why that kid who lives in your basement on a three-legged couch incessantly watches pornography on his cellphone. All the jobs out there are soul-sucking crushes, fruitless and stupid wastes of time. Even looking for that job is a waste of time. Fixing the couch isn’t worth the trouble, either. Glue? Nails? It’s all too complicated.

Facts

Facts only obstruct a good theory, but Dollar$ is not yet of the party that deems feelings should be the basis of policy because facts are no more than the legacy of the dying culture called Western Civilization, but our hearts never err and can only lead us to a better world. As Donald Trump and deconstructionist professors have taught us, facts are relative.

However, some facts are numbers.

  • In November 2017, the US economy created 228,000 new jobs
  • The jobless rate for non-high school graduates is 5.2%
  • The jobless rate for the overall US economy is 4.1%, the lowest it has been since the dot-com bubble burst in 2000.
  • After years of lackluster growth of 2%, the economy is now growing at nearly 3%, a pace that means business expansion will require ever more new employees and—gasp—will need to pay entry-level employees well to compete for their heads and hands.
(figures from The Wall Street Journal, Dec 9, 2017)

By the way, Dollar$ also notes that the economic expansion these figures suggest is worldwide. The stock market is soaring because that confidence in the future is shared most everywhere. If Finance Buccaneers don’t screw it up by inventing products that have no basis in reality and then leverage that fantasy 100-fold before selling those vehicles to municipal retirement accounts, regional banks, and other suckers, your BitCoin Futures, for example, we are in for some good years.

Good news upsets ideologues who prefer to complain about their ongoing, constant anxiety even though that anxiety, at least in the economic sphere, is misplaced. Sure, things can go wrong, and eventually will, but the quality of life has never grown in a straight line. When things suck, wait a while. They will turn around. You don’t really need to check under the bed each night.

For example, Robert Reich, the Beserkely professor, former Secretary of Labor, and Facebook columnist, checks under the bed three to four times each day with columns and videos. His trauma at not being reintroduced to the corridors of power when Hillary Clinton failed to be elected must have been acute. Instead of running the world, he is on the sidelines where he generates a tsunami of media whose final point is that whomever is doing whatever, Professor Reich could do it better. He has the time to do this because California pays him in excess of $400,000 per year, requires him to teach no more than one or two classes, pays the salaries of a cadre of graduate students to assist him with his onerous work, collects $40,000 for speaking engagements, and has published a book called Saving Capitalism, which, if Dr. Reich’s situation were typical, would seem to need no saving at all.

At least not for him.

Baby Boomer Failures

  • The safe and cheaply available birth control that makes hook-up culture possible on that basement couch, thus eroding the moral fiber of our culture.
  • The internet that delivers porn directly to the basement couch.
  • The virtual elimination of several diseases, such as polio and smallpox.
  • The virtual elimination of famine because of advances in agriculture and the successful world distribution of crops like winter wheat.
  • The Civil Rights Movement of the 1960s.
  • The Women’s Rights Movement that began again in the 1970s.
  • Passenger jets. How else can a Millennial go backpacking in Nepal before taking residence on the sofa?
  • Cell phones, that device that permits Millennials to snap selfies, cat photos, and up-to-the minute data on any Millennial’s location should they venture from the basement, all forms of narcissism previously never seen on our planet.
  • Digital special effects that bring believable visions of world apocalypse and intergalactic warfare to that cell phone or the game box beside the couch facing the flat screen TV on which HD pornography plays most of the day.
  • The rising preponderance of women in higher education as students, teachers, and administrators.
  • Automobiles that cost more because they are built to new standards of safety, airbags, seatbelts, and the like for passengers who strangely wish to live through collisions. Those doodads are constructed with materials other than steel to keep vehicles lightweight enough to conserve fuel. slow global warming, preserve energy, and keep that basement comfy.

Why are These Failures?

Dollar$ is glad you asked.

The work, you see, is not yet done. Those damn Boomers selfishly left the world imperfect. Some kids may have to get off the couch and build better infrastructure, get us renewable energy sources, find better batteries, silence jet engines, create hologram entertainment, and take the US out of rubber, concrete, and petroleum logistics.

You know, work and innovate.

Effort sucks.

Totally.
download

 

 

 

WEALTH INEQUALITY

In Business, Economics, Economy, EDUCATION, Finance, Political Economy, Politics, TAXES on December 5, 2017 at 10:40 pm

bossy sisterWhenever my big sister played Monopoly, if the game was going against her she would toss the playing board in the air. My hotels and houses would scatter across the living room carpet as she shouted, “Salugi!” (a New York-ism pronounced “suh-LOO-gee”)and lunged across the table to confiscate most of my deeds, especially Boardwalk and Park Place.

When I was able to read the rules of the game, I learned there was no allowance for tossing the game in the air or confiscating my property. My sister was cheating! But since I was 8 and she was 14, she was able to meet my accusation by beating me up.

The History of Wealth Redistribution

My sister was a revolutionary.

To be sure, Dollar$ reminds readers that rebels object to rules, but revolutionaries rewrite them. Rebellions are common; revolutions are rare.

The folks who threw the board in the air in the past have cried, “Justice!” not “Salugi!” They had names like Washington, Lenin, Mao, and Castro.

Note that political persuasion—Left or Right—has nothing to do with revolutionary status. Mao and Washington might have discussed military tactics, but Dollar$ suggests they would have come to no agreement about economic systems or the function of government.

The Function of Governmentpreamble-20532-20120118-55

It’s less complicated than Monopoly.

We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.

Washington (the dude on the $1) believed that the function of government was primarily to protect the rights of the individual, rights that most often needed protection from government itself. If no military personnel have been billeted in your living room, thank Washington.

Washington may have noted that to promote the general welfare required some redistribution of wealth to insure equal opportunity and to insure domestic tranquility, but that does not guarantee equality of status among citizens.

Washington’s pal was the first Secretary of the Treasury, Hamilton (the dude on the $10). Hamilton understood that wealth concentration in institution like banks were a social good, provided the bank used that concentration of wealth to fund the visions of a greater society, lending money to visionaries and giving stability to the economic infrastructure by protecting wealth from being squandered by a ruling class on personal indulgences. Hamilton, an orphan at 11 and the illegitimate son a British West Indies plantation owner, would likely not endorse a notion that the function of government was to protect the rights of the filthy rich to become obscenely rich.

The Situation Today

Some of Dollar$’s best friends sink into fuzzy thinking when talk comes around to how wealth is created and distributed in the United States. They lose sleep fearful that someone, somehow, somewhere, is leveraging assets to optimize profit.  They simple-mindedly believe that economics is a zero-sum game and cannot imagine economic growth. If an organization makes a dollar, someone must be a dollar poorer.

No. That simply is untrue. If it were so, you and I would enjoy the same standard of living as Washington and Hamilton. But the fact is that economies grow.  At issue is how they grow, not whether they should grow at all, though there are indeed some who think that a good idea, too.

The deluded friends of Dollar$ from time to time propose bold programs to redistribute wealth, programs they understand as pursuing Justice.

There two reasons those cannot and should not work.

1. Nowhere in the US Constitution will one find the word corporation. True, we reserve the right to free assembly, but that does not elevate any assembly of citizens devoted to profit a guaranteed right to speak lies in its advertising or compensate its directors and executive officers so rapaciously that shareholders who hope to partake of the boons of the system see their profit participation reduced by rapacious Buccaneers.

Oliver-Wendell-Jr-Holmes-9342405-1-402
Not Sherlock; not Mycroft, just Oliver

2. Oliver Wendell Holmes, Jr. noted Taxes are the price we pay for a civilized society. The idea is carved in stone on the IRS building in DC., but let’s note that corporations do not pay taxes, they collect them.  If you think they do not, you are submitting to a distraction. Dollar$ hastens to explain that citizens are consumers. Tax us, and we bleed money. Bleeding, we consume or save less, neither of which are good things, though it does not follow consumers should not be taxed. Civilization is messy, but must be purchased. But to a corporation, taxes are a cost of doing business, like labor, supplies, and logistics.

Raise corporate tax rates, and corporations will only raise their prices.

Guess who pays the difference?

Today’s  Lesson

Remember, friends, we cannot pursue social justice by confiscating wealth. We can, however:

  • Limit executive compensation by law to some multiple of the lowest worker in an organization;
  • Create progressive income tax brackets that limit the shift of American wealth to the rich from the poor;
  • Lower repatriation taxes so that companies that keep their money off-shore are encouraged to bring it home where they can invest in more factories and create jobs here–better to collect 15 percent of something than 30 percent of nothing;
  • Demand that higher education is a matter of national security, and so to insure the blessings of liberty are  free to all;
  • To insure the blessings of liberty on ourselves and our posterity, give tax breaks to organizations that train employees instead of demanding that future employees borrow so much money to gain perceived needed skills that students have no choice except a life of indentured servitude;
  • Regulate publicly traded corporations by disallowing aggregation of profits as cash without paying shareholder dividends, a means to share in that profit. Can we stop the nonsense that hoarding cash is good corporate financial strategy when all it does is spike share prices that are subsequently used to calculate executive performance compensation? (Are you listening Apple Computer?)
  • Return to personal income tax rates that  reflect the needs of our society. Under Eisenhower, we built the interstate highway system and taxed marginal income as much as 92 percent.

We don’t have to throw the game board in the air to start over again: all we need to do is play by the rules.

DEMONIZE THE OTHER GUY

In Business, Finance, Political Economy, Politics, TAXES on December 4, 2017 at 5:50 pm
screwed1

Citizen

Dollar$ sadly notes that social media has reduced American political discourse into rabidly demonizing the other guy. I wish we could say Dollar$ is surprised.

If you dislike the proposed tax bill, it cannot be that in 500+ pages there is not a line or page you admire. If you admire the new tax bill, it cannot be the in 500+ pages there is not a page that is wrong-headed.

Here’s a challenge: call your representative and ask him or her what he or she likes (or dislikes) about the bill. Make them reverse field. Watch them cry.

Real-world logic allows for conversation and (gulp) compromise. Instead, we see Republicans who simply walked away from their responsibilities for the final year of President Obama’s tenure and refused to act on anything at all; we now have Democrats who think what citizens want is for them to do the same, to get even.

You know, like a kid in a school yard with a grudge.

Wake up, ladies and gentlemen who  represent us—none of us voted for you to do that.

Is it any wonder that Congressional approval ratings linger under 15%? Think of it, 6 of 7 Americans think their representatives are a bunch of horses’ asses.

Guess who is getting screwed?

Congress at work.

Congress at work

CONSPIRACY THEORY

In Business, Economics, Economy, Finance, Political Economy, Politics, Wall Street on February 12, 2016 at 1:09 pm
Janet Yellen

Wizard-in-Chief

Dollar$, always eager to explain the inexplicable world of Finance, that realm in which Wall Street Wizards and Corporate Buccaneers run rampant in their never-ending struggle to own, pervert, master, and control Political Weasels, has developed a theory.

 

Why should Plain Money Talk  be any different from every other blog?

 FACTS

2015 saw:

  • unemployment drop to new lows,
  • minimum wage adjusted up,
  • auto sales rise to recent highs,
  • home sales rise to recent highs with no speculative bubble,
  • the cost of gasoline and heating oil sink to new lows,
  • the United States become an oil exporter.

The Fed is so concerned at all this good news that Janet Yellen has begun to tighte credit, a tactic employed to throttle growth and forestall inflation. Yes, the Wizard-in-Chief, Janet Yellen, is worried things are too good.

Some apologist is sure to point out that the second largest economy in the world, China, is hurting. Dollar$ will give that point of view some quick attention.

CHINA

China’s weakening economy should mean the cost of living in the US will drop, meaning you and I will have more money in our pockets to pay off debt or buy more stuff, everything from furniture to T-shirts at Wal-Mart. The US – China trade balance is heavily weighted toward China—the US imports far more goods from China than China imports from the US. If those good become less expensive, the American consumer benefits. This does NOT harm American business.  Maintaining profit margins at lower prices is easy to do. The cost of commodities the world over is dropping because of the slowdown in Chinese demand. Commodities are the stuff that comes out of the ground from tin to lumber and to gold, the stuff from which everything else is made. Everything should be getting cheaper. Every time Wizards predict that Apple will stop selling iPhones in Shanghai, Apple sells another few million units, but at a lesser price. With inexpensive gasoline, Citizens will be driving  to Disneyworld this year, and they will be able to afford the Mouse’s uptick in prices.

This phenomenon confounds the Wizards., who have learned that bad predictions are clickbait, and clicks drive revenues. No one watches CNN until the shit hits the fan and the shelter under the table grows crowded and cramped.

In the face of positive economic news, the US stock market should be soaring. Instead, the Dow-Jones average has stepped off a cliff in 2016, shedding 2,000 points in 8 weeks, more than a trillion dollars worth of value has been erased from the books.

THE CONSPIRACY

Cui bono?

For the past 30 years,  at every presidential election, commentators complained of the choice between Tweedledee and Tweedledum. But this year, it ain’t so.

weasel candidates in days of yore.

US Presidential Candidates Since 1964

 

This year, on the one hand, we have a wealthy, self-funded foul-mouthed injudicious narcissist celebrity never elected to anything anywhere who is much favored by people who have felt disenfranchised for a generation. On the other hand, we have a New York Jew now from Vermont who has never accepted a dime from Buccaneers or Wizards. An older man, his followers are youth because he demands payback from the banks and companies who were too big to fail and in the past 20 years have sucked the economy dry, indenturing students with education debt. On the third hand, we have a woman who is indebted to the old politics, and on the fourth hand, we have a clown car of interchangeable Republicans who lacking economic issues promise to disallow what your neighbors do in their bedrooms while coyly ignoring that for those promises to be fulfilled they will have to rollback several Supreme Court decisions by what by any account has been a conservative court.

Dollar$ sees the common threat. The two leading candidates are not in thrall to Wizard or Buccaneers. Should either get elected, the summer house in the Hamptons, the private jet, and the 10-room Manhattan  condo are all in jeopardy.

How to dissuade Citizens from voting for either?

Scare the piss out of them. Scare the piss out of them by manipulating stock prices downward. It’s only temporary, and it’s not as tricky as it sounds.

  • Claim good news is bad.
  • Threaten us with defunded pensions, evaporating college savings, and the elimination of savings toward the American Dream, a house.
  • Imply that unless Citizens vote the status quo and allow rapacious policies to continue, grass will grow on Main Street as economic activity collapses.

The stock markets should be soaring, but never forget that 90 percent of all trading is electronic and that computer algorithms engage in a global battle to take advantage of a quarter point’s worth of arbitrage. There is no longer any such thing as investor sentiment. As they now say in Wizard country, My algorithm can beat up your algorithm!

Fear is the most potent means of keeping the harridans out of the White House. Without the creation of synthetic Terror, Weasel Business As Usual will come to a halt.

O the horror!