patrick.net

upisdown says

smaulgld says

That would be ok from the US perspective except we need to keep borrowing so

we need countries like china to keep holding, rolling over and buy our

bonds.

My same answer above applies to this statement.

Again my response is the same.Sure you can find someone else to buy the bonds, but can we find an entity that will be willing to buy as many and at the low rates we would rather pay

smaulgld says

threat

The key word.smaulgld says

FORTUNATELY, yields did not rise as the markets mostly saw through the
charade that somehow there was going to be a default. However, that doesn't make
it right that default was threatened

I totally agree.

smaulgld says

but can we find an entity that will be willing to buy as many and at the low
rates we would rather pay

True, but that's for the market to decide, right? Sorry, but the shenanigans DO have consequences, and maybe the teapublicans shouldn't have chosen that as a play-toy, or object of hatred. Or maybe those teapublicans should be run out of office for doing that, considering it's importance.

upisdown says

But, ALL that "debt" is in our own currency, so exactly WHO is calling the shots? They are free to take their dollars and go home, but it IS nice that they use it to buy inflated or overpriced stuff from us.

In a way its like mutually assured destruction.

If the chinese stop buying our bonds, we would have a hard time paying them back on their existing US treasury holdings and the value of their 1.3 trillion in holdings get devalued by a massive amount. So the Chinese continue to buy. BUT as I noted earlier, they are making arrangement to diversify away from the dollar and US treasures so they are not locked into buying our bonds

THAT is the big threat to us.

smaulgld says

If the chinese stop buying our bonds, we would have a hard time paying them back
on their existing US treasury holdings and the value of their 1.3 trillion in
holdings get devalued by a massive amount.

They'll just print more RMN to cover it.

DOOOOHHHHHHHH

upisdown says

But the funding of the mandate is IN the law(which it was), which would mean it has to be funded in part, but maybe not in whole. there's multiple ways that the ACA was funded, from taxes to tax credits, so I guess that only certain parts of it could be funded(the tax revenues) and other parts (tax credits) could be neglected by congress.

There is the rub!-Congress Can NOT obligate it self to future spending OR future spending cuts. Each congress (is supposed to!) create its own budget each year.

That is why it is a farce when they agree to cut spending in future years -it is non binding, just as a law TO spend money in the future is non binding.

smaulgld says

BUT as I noted earlier, they are making arrangement to diversify away from the
dollar and US treasures so they are not locked into buying our bonds

It's hard to believe that they haven't taken some money and went, instead of rolling over the debt endlessly. It's like a tenant owing us money and we just keep tacking that rent onto the end of the lease instead of them making small payments to us, because we would then have given them the (bigger)incentive to not pay at all.

smaulgld says

That is why it is a farce when they agree to cut spending in future years -it
is non binding, just as a law TO spend money in the future is non binding.

You do have to admit though, those congress f-ers have it made. It's like being a weatherman and saying there's a 50% chance of rain.

Here is an example- let's say in 1850 Congress passed a law to provide federal funds to track down fugitive slaves. Let's say the law provided for increased spending in each of the years 1851, 1852, 1853 and by 1854 the amount would be 5x what it was in the original allocation of 1851.

Let's say that in 1852 there is a massive abolitionist movement and the abolitionists take 60% of the seats in congress.

They are not obligated to fund the monies to track down fugitive slaves.

Indeed if it were any other way. ONE congress could bind our futures forever simply by passing a law in one year and saying that it has to be funded in perpetuity

I have to run a couple of errands........good discussion though.

upisdown says

smaulgld says

BUT as I noted earlier, they are making arrangement to diversify away from the

dollar and US treasures so they are not locked into buying our bonds

It's hard to believe that they haven't taken some money and went, instead of rolling over the debt endlessly. It's like a tenant owing us money and we just keep tacking that rent onto the end of the lease instead of them making small payments to us, because we would then have given them the (bigger)incentive to not pay at all.

Yep!

upisdown says

True, but that's for the market to decide, right? Sorry, but the shenanigans DO have consequences, and maybe the teapublicans shouldn't have chosen that as a play-toy, or object of hatred. Or maybe those teapublicans should be run out of office for doing that, considering it's importance.

Agree and the market it can be safely predicted based on experience require higher rates. And you are right that actions do have consequences but we can't just blame teapublicans for that -The president and jack Lew were fear mongering and talking default too and refusing to level with us that the debt could always be paid.

upisdown says

They'll just print more RMN to cover it.

DOOOOHHHHHHHH

If the Chinese print RNB to cover any treasury losses they would experience immediate and massive inflation as the impact of such a scheme would be felt mostly in China.

The reason the US gets away with printing money at the Fed is that it is spread out across the globe (and also held tight at the TBTF banks) because the dollar is used in 60% of international transactions so the impact of putting a trillion a year into the system is muted somewhat

upisdown says

You do have to admit though, those congress f-ers have it made. It's like being a weatherman and saying there's a 50% chance of rain.

The reason they have it made is because they convince people that all the problems are caused by the other half of congress and getting people to take sides and feel strongly about "teapublicans" and "leftwingers" when all of them are the problem because the voting public has little understanding of how government works and they can be easily manipulated into sloganeering to make their points

upisdown says

I have to run a couple of errands........good discussion though.

Excellent- thanks for the debate

smaulgld says

upisdown
says

They'll just print more RMN to cover it.

DOOOOHHHHHHHH

If the Chinese print RNB to cover any treasury losses they would experience
immediate and massive inflation as the impact of such a scheme would be felt
mostly in China.

Had a brain fart and for the life of me I couldn't remember the initials for their currency, thanks for not making me look like a mope.

smaulgld says

The reason the US gets away with printing money at the Fed is that it is
spread out across the globe (and also held tight at the TBTF banks) because the
dollar is used in 60% of international transactions so the impact of putting a
trillion a year into the system is muted somewhat

I have a theory............about the dollar being the reserve currency, along with the 20, 50, and 100 dollar bills being the most common bills that are confiscated in regards to ill-gotten-gains. The $100 bill just went through a transformation or update of counterfeiing measures, and yet the $100 bill is the most common for laundering, transporting large amounts of money due to the total($)p/density($1 million weighs approx 22 lbs), so do away with the large denominations, and that will have THE largest impact on crime, outside of gun crimes. All crimes are based solely upon a shortcut to prosperity versus the time factor of incomes.
Eliminate the very thing that enables, encourages, and continues crime(outside of violent crime) and you take away the advantage of the shortcut to prosperity or immediate satisfaction.

upisdown says

Eliminate the very thing that enables, encourages, and continues crime(outside of violent crime) and you take away the advantage of the shortcut to prosperity or immediate satisfaction.

Bingo-you finally hit upon it! Eliminate the Fed's ability to print money to monetize debt and they can no longer steal from you and me in the name of "fixing" the economy

smaulgld says

upisdown says

Eliminate the very thing that enables, encourages, and continues crime(outside of violent crime) and you take away the advantage of the shortcut to prosperity or immediate satisfaction.

Bingo-you finally hit upon it! Eliminate the Fed's ability to print money to monetize debt and they can no longer steal from you and me in the name of "fixing" the economy

Agreed. Also simplify tax laws and eliminate all deductions and loopholes. These deductions are as absurd as the money printing to "fix" the economy.

mell says

Agreed. Also simplify tax laws and eliminate all deductions and loopholes. These deductions are as absurd as the money printing to "fix" the economy.

yes if there are going to be taxes they need to be across the board with no special ways to get out of them just because you do or don't do something or make more or less than anyone else.

That includes the mortgage interest deduction.

otherwise get rid of them as they become a system to allow one segment to live off the other segment for free

mell says

Agreed. Also simplify tax laws and eliminate all deductions and loopholes. These
deductions are as absurd as the money printing to "fix" the economy

Redundancy isn't a viable argument.

smaulgld says

yes if there are going to be taxes they need to be across the board with no
special ways to get out of them just because you do or don't do something or
make more or less than anyone else.

That includes the mortgage interest deduction.

otherwise get rid of them as they become a system to allow one segment to
live off the other segment for free

I agree, but hopefully that includes capital gains taxes, and the ultimate scam.........estate taxes, whereas taxes were escaped for the life of an asset(land) and then thrown into a trust.

upisdown says

mell says

Agreed. Also simplify tax laws and eliminate all deductions and loopholes. These

deductions are as absurd as the money printing to "fix" the economy

Redundancy isn't a viable argument.

It's simple. Don't favorite one segment/sector of income or debt over the other, that is crony capitalism and creates distortions, scams and all kinds of unproductive "middle-men" type of businesses.

mell says

Don't favorite one segment/sector of income

But the right wants to lump that and debt together, as if they are exactly the same. They aren't, by many measures.

upisdown says

I agree, but hopefully that includes capital gains taxes, and the ultimate scam.........estate taxes, whereas taxes were escaped for the life of an asset(land) and then thrown into a trust.

upisdown says

But the right wants to lump that and debt together, as if they are exactly the same. They aren't, by many measures.

I don't understand either comment. please explain

smaulgld says

yes if there are going to be taxes they need to be across the board with no
special ways to get out of them just because you do or don't do something or
make more or less than anyone else.

upisdown says

I agree, but hopefully that includes capital gains taxes, and the ultimate
scam.........estate taxes, whereas taxes were escaped for the life of an
asset(land) and then thrown into a trust.

My point was about estate taxes, and how the semi-uber wealthy can esacpe taxes on assets that they have held for decades by transfering them into a trust, and NEVER paying the gain in equity or market value. I've seen it 50 times if I've seen it once.

smaulgld says

upisdown
says

But the right wants to lump that and debt together, as if they are exactly
the same. They aren't, by many measures.

I don't understand either comment. please explain

Income taxes on all kinds of income are usually lumped in with other taxes(estate, deductions, etc.) but don't stand a chance of scrutiny because they all lumped together as if they were exactly the same, but they aren't.

upisdown says

mell says

Don't favorite one segment/sector of income

But the right wants to lump that and debt together, as if they are exactly the same. They aren't, by many measures.

I discount both of what is considered the "right" and the "left" in the US as their monetary (and a lot of other) policies are too similar.

mell says

I discount both of what is considered the "right" and the "left" in the US as
their monetary (and a lot of other) policies are too similar.

That's a benign and bland answer. At least you could've made something up. No?

upisdown says

mell says

I discount both of what is considered the "right" and the "left" in the US as

their monetary (and a lot of other) policies are too similar.

That's a benign and bland answer. At least you could've made something up. No?

OK, a concrete example relevant to patnet:

The left and the right are debating capital gains taxes while nobody considers the absurdity that you can buy a home and sell it after 2 years and pocket 250K/500K of capital gains. On top of that there are some provisions where you can take some tax-free IRA money to provide for the down payments. I will never ever agree to any increase in capital gains taxes until these "exemptions" are removed or until everybody can take pre-tax money for whatever they decide to buy and gets an exemption for up to 250K/500K for whatever they bought as long as they sell it after 2 years. And if you want to argue left vs right, then Romney's tax plan (eliminating deductions such as mortgage interest) was a lot fairer and simpler then Obama's.

mell says

And if you want to argue left vs right, then Romney's tax plan (eliminating
deductions such as mortgage interest) was a lot fairer and simpler then Obama's.

LOL, that's like arguing the smell of shit. You miss the big picture, and the fact that Romney was patronizing you because of the ridiculousness of home ownership. It's the big picture, grasshopper.

upisdown says

mell says

And if you want to argue left vs right, then Romney's tax plan (eliminating

deductions such as mortgage interest) was a lot fairer and simpler then Obama's.

LOL, that's like arguing the smell of shit. You miss the big picture, and the fact that Romney was patronizing you because of the ridiculousnes of home ownership. It's the big picture, grasshopper.

Well you wanted a concrete example and now you are arguing the bigger picture. Let's see we have talked about the crony capitalist FIRE sector and its unfair subsidies and deductions that make absolutely no sense, the Fed counterfeiting, all of which brought you the 2008 crisis, there is no bigger picture. The monetary policies of the left and the right are the mostly the same catering to their crony masters and contributors.

upisdown says

smaulgld says

yes if there are going to be taxes they need to be across the board with no

special ways to get out of them just because you do or don't do something or

make more or less than anyone else.

upisdown says

I agree, but hopefully that includes capital gains taxes, and the ultimate

scam.........estate taxes, whereas taxes were escaped for the life of an

asset(land) and then thrown into a trust.

My point was about estate taxes, and how the semi-uber wealthy can esacpe taxes on assets that they have held for decades by transfering them into a trust, and NEVER paying the gain in equity or market value. I've seen it 50 times if I've seen it once.

I see. Where I am against the estate tax is where a family buys a home say in San francisco 30 years ago for 250K and its now worth 2.5million. There are two kids when the dad dies. One maybe is living there. The estate owes $1 million in estate taxes on the house. They have no where near that amount of money so they sell the home to a "rich " person at a low price.
That is not fair. Ditto for family farms that Monsanto buys in estate tax foreclosures.
If its yours, it also belongs to your kids-esp if in the example of the farm they work on it

upisdown says

Income taxes on all kinds of income are usually lumped in with other taxes(estate, deductions, etc.) but don't stand a chance of scrutiny because they all lumped together as if they were exactly the same, but they aren't.

Thanks, but I still don't understand. No need to try again I can remain ignorant on this when and until you raise it again!

smaulgld says

Ditto for family farms that Monsanto buys in estate tax foreclosures.
If its
yours, it also belongs to your kids-esp if in the example of the farm they work
on it

LOL, if only that were true. Owning an asset 25-40 years and never paying the the taxes on the gain in equity, but taking it out of everybody else's hide to cover for the lack of your contributions.
Then after a lifetime of subsidies, they continue to be the risk-averse sleps they always were, because there's no risk and all reward in things when the government backstops you. Then, the lazy and useless POS's won't allow the productive asset do go into REAL productive hands, because......the government checks/backstop will stop. And so, those POS's and everybody just LIKE them, bring down the sector as a whole.
But hey, the juice continues because it's vote-buyin'. It makes Tamany hall look like a rookie system.

upisdown says

But hey, the juice continues because it's vote-buyin'. It makes Tamany hall look like a rookie system.

Its hard for me to argue about what type of taxes are best as I am against them in principle!

smaulgld says

Bingo-you finally hit upon it! Eliminate the Fed's ability to print money to
monetize debt and they can no longer steal from you and me in the name of
"fixing" the economy

I set myself up for that. I mean crime in general.LOL

mell says

the absurdity that you can buy a home and sell it after 2 years and pocket
250K/500K of capital gains. On top of that there are some provisions where you
can take some tax-free IRA money to provide for the down payments.

Who did that, and why? To encourage ownership of a uselss and costly "asset', that eats money versus one that returns money, now. Is there any wonder that the uber rich own 85-90% of all liquid assets, and the vast majority of other people(middle class) own a depreciating asset called a house?

mell says

Well you wanted a concrete example and now you are arguing the bigger picture.

You really think that there's huge money in mortage deductions, considering the standard deduction amount?

You fell for the 'tax he, but not me' routine. Notice how Romney's tax brackets and playground were untouched?

Isnt the mortgage intererst deduction the largest and most widely used?