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Beware of falling prices

Discussion in 'Political Discussion' started by PatriotsReign, Jun 8, 2010.

  1. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    From CNNMoney this morning.....

    Lower prices could mean deflation and double-dip recession - Jun. 8, 2010

    "Only a few months ago, inflation was the main worry of many economists. But falling prices for the raw materials of many industries, including lumber, have set off deflation warning bells for some economists, who worry that they could signal another global economic downturn.

    While consumers love falling prices, deflation can cause far more damage to growth than inflation can. Lower prices cause businesses to cut back production, which can lead to layoffs, which can then cause further declines in demand due to falling incomes and consumer spending, creating a downward spiral."


    Definately cause for concern for all of us. The only way deflation can be good is if you remain employed and reap the benefits of falling prices. But for the country and world as a whole, there is nothing good about it.

    DE-flation, not IN-flation!
     
    Last edited: Jun 8, 2010
  2. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    It's interesting how much globalization has complicated economic recovery. I think both Democrats and Republicans saw globalization as good for world peace and economies, but now it seems as if the international community is fighting fire after fire to prevent the problem from spiraling out of control. Making matters worse is that nations in general are not that interested in cooperating. I think from an economics perspective we're in unchartered territory, but I think the only way to fix the mess is to impose a hefty one time tax on the extremely wealthy.
     
  3. Real World

    Real World Moderator Staff Member

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    ahahahahahahahahahahahah!!!!

    Tax the rich...ahahahahahahahahahahahah!!!! [​IMG]
     
  4. khayos

    khayos In the Starting Line-Up

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    LOL yeah, that's the best idea ever! Tax all the individuals that provide the jobs! And we wonder why there's so much of disconnect between line worker and CEO pay...
     
  5. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Why should shareholders pay lower tax rates than working people? Long term capital gains tax is only 20%, far less than most income tax brackets. While I can sort of understand obsequiousness to the rich, I fail to understand why you would favor giving them lower taxes than everyone else. And, besides that, you've merely objected to a solution, rather than proposed one. What do you think we should do? Any specifics?
     
    Last edited: Jun 8, 2010
  6. Real World

    Real World Moderator Staff Member

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    Even if a 100% tax were levied on the richest people, it wouldn't be enough to pay off the debts we face. Which is an aside from that fact that a one time influx of cash, does nothing to solve the causes of the problems we face. That's the establishment way of dealing with problems though. When in doubt, just throw more money at the situation. Works like a charm.
     
  7. Wolfpack

    Wolfpack Banned

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    :rofl: :rofl: And had actually had the audacity to say "one time"!! :rofl: :rofl:
     
  8. chicowalker

    chicowalker Pro Bowl Player

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    This is different than a 1-time tax on the "extremely wealthy."
     
  9. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    How do you mean? I didn't really define the tax. It could be an assessment on top of their current taxes or it could be a substantial increase in their capital gains tax or a combination of taxes.
     
  10. Real World

    Real World Moderator Staff Member

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    And he then called it a "solution" to boot. So fellas, when your wives go out shopping for shoes, blowing up your credit card, constantly spending money you don't have, don't try to contain the spending. Just go out and get another 3 jobs. That, or put a gun to your bosses head, and demand a raise, since it's he who should pay for your wife's shopping. :rolleyes:

    Frauders, investments are made with taxed money. Also, if you overtax investment dollars, fewer people will assume the risk that investing money brings. Fewer investers, means less capital changing hands, and subsequently, less growth. Less capital and growth, means fewer jobs and opportunity. As always, the problem isn't with taxing more. The problem is in trying to get the gubmit to spend less. I would like to think that $3-4 trillion per is more than enough, if not too much, don't you?
     
  11. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    Real, I suspect you have no evidence to support your claim because none exists. Our tax rates were much higher from the 1940s to the early 1980s and our economy did quite well. There was no serious dearth of investment.

    Lastly, to further disprove your unsubstantiated point, our taxes at the lowest since 1950. Where's all the investment in new jobs?

    Tax bills in 2009 at lowest level since 1950 - USATODAY.com
     
  12. patsfan13

    patsfan13 Hall of Fame Poster PatsFans.com Supporter

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    Because shareholders income is already double taxed. The Corp profits are taxed and then the capital gains are also taxed. This makes investing in enterprises that can generate jobs less profitable, so less investment money to create new jobs.
     
  13. Patters

    Patters Moderator Staff Member PatsFans.com Supporter

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    We had low taxes prior to Roosevelt and resulted in multiple recessions and finally the Great Depression. We had very low taxes under Coolidge and Hoover and that resulted in the Great Depression. We had high taxes after that until and our economy did well until Carter. We had lower taxes after that and our economy did well until Bush. So, there really isn't that much correlation between taxes and economy strength. In fact, one could easily argue what gave our country economic strength is not the low taxes but the even greater increase in federal spending by Reagan and Bush, as well as most of the other presidents.
     
  14. Ilikehappyppl

    Ilikehappyppl 2nd Team Getting Their First Start

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    No No No, DON'T tax the rich!!!

    Without them there would be no air
    Without them life would not go on
    Without them I could never sleep
    WIthout them I could not eat
    Without them I could not fish or dry my own clothes
    Without them I could not have a job
    Without them God would leave
    WIthout them the USA would go down in a ball of flames
    Without them birds would not sing
    Without them the Sun would not shine!!!

    Sound about right?

    I don't need anyone!!!! neither does the USA!!! The rich don't hold me by the balls, my two hands can do anything and I don't need anyone!

    IMO 90% on anyone making over 10mill, 80% anyone making over 5mill, and 60% of anyone making 1mill tax the fack out them~
     
    Last edited: Jun 8, 2010
  15. mcgraw_wv

    mcgraw_wv In the Starting Line-Up

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    Deflation doesn't spiral out of control, it sprials down to it's natural level. It only spirals down to where the market feels it should be.

    Once prices fall enough, to match the economic climate, it will stabilize.
     
  16. chicowalker

    chicowalker Pro Bowl Player

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    I'm saying that a 1-time tax on the extremely wealthy isn't the same as opposing differential treatment for capital gains versus ordinary income.

    The latter is a legitimate point of view, imo.

    The former is pretty flawed -- it won't come close to taking care of our existing budget issues, it doesn't do anything to address the underlying problems, it likely would turn into a a recurring tax, it reinforces the idea some people have that the "wealthy" should pay for things and, while this may just be a visceral reaction, it strikes me as almost punitive in nature.
     
  17. mcgraw_wv

    mcgraw_wv In the Starting Line-Up

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    1 time tax = Stealing just this one time.
     
  18. khayos

    khayos In the Starting Line-Up

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    If I'm really wealthy, I just happen to move all my money out of the US for that one time...
     
  19. chicowalker

    chicowalker Pro Bowl Player

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    Of course, nobody's advocated not taxing the rich, but I guess the extremists left and right need their bogeymen.

    Any basis for this opinion, or just that you're not rich and don't like the fact that other people are?
     
  20. PatriotsReign

    PatriotsReign Hall of Fame Poster

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    #18 Jersey

    That isn't entirely accurate mcgraw. If you read the article, deflation creates more unemployment which further depresses prices, corp. income and finally, demand for goods and services. This process can spiral downward continuously.

    What may appear to be todays' "natural bottom" won't be the same as if unemployment goes to 13%, and so on.
     

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