Financial Markets

[GTNavyNuke]

I love the idea of a flat tax on consumption with a "rebate" for people whose income is less than a certain amount a year. I believe in a progressive tax system where you pay more (even as a percentage of income).

What Trump proposed was the typical politician ploy - be specific about the tax cuts (lowering rates) but not specific about the offsetting reductions in write-offs. Typical politico speak is to say that we have one of the highest tax rates in the world for business but neglect to say that the amount we collect after deductions is very low.

 

[buzz_wiser©]

We are in dire need of a huge revamp of the taxing system regardless.
Being self employed, I tend to get hammerd.
However. I can deduct alot of things that normal people cant.

I would surely enjoy a flat rate to where each pays their fair share.
If we could ever agree in how that would work.

 

[awbuzz]

Everyone should have to pay "something"... even if only a buck. Put some skin in the game and people think differently.

 

[buzz_wiser©]

I understand this and wish it were that easy!!
How many people do you know that when they file their taxes use the child tax credit with 5 kids and don't have a job nor income of any sort, yet they end up with a 8k dollar refund because of how the tax codes work.

Skin in the game would be great!

 

[GTNavyNuke]

Everyone should have to pay "something"... even if only a buck. Put some skin in the game and people think differently.

People have time, talent and treasure to contribute. I think community service commensurate with the Government money they receive makes sense. That would be the skin in the game that I'd like to see.

On a financial note, Friday was the biggest US equity index reversal in 4 years. Bad employment data this month and big downward revision the previous month along with weak factory data show the economy wasn't as strong as thought a few months ago. So after a small sell off on bad news being bad news, money flow seems to take over. Hard to tell what is noise and what is real .......

The Fed can do very little to help the real economy right now (IMHO). But they are caught by their stated desire to come off crisis low interest rates and QE with the fiction that what they have been doing affects employment rates. The Fed has put out many reports showing little correlation between the low interest rates / QE with employment; yet they have used this grossly lagging indicator as their principal publicly stated litmus test. They either need to keep up the facade or publicly admit they were wrong ..... I don't see them raising the rates, but who knows.

 

[TechnicalPossum]

I think this would happen no matter what.
What are the opinions on no income tax or flat tax in consumption?

I like the idea in theory but I don't think it is realistic due to the the concentration of wealth/income.

 

[LibertyTurns]

Did we have a ZBT today? Anyone have the stones to go back all in again? I'm dipping my toe in, but majority of my $$ pile is still being idled waiting for the technicals to improve.

http://humblestudentofthemarkets.blogspot.com/

 

[AlabamaBuzz]

Income tax is stupid. Consumption tax would be a much better way to obtain revenue from ALL Americans, not just those that work transparently and legally.

 

[GTNavyNuke]

Think you guys will like this article by Lacy Hunt on Fed options. I don't know what is going to happen; I've said I expect QE4 before the Fed raises rates again. After thinking about this some more, maybe the Fed will go to negative interest rates next. Other countries have done that including mostly European ..... the better the idea for select interests and the worse for the majority, the more likely it is to be attempted. But again, I have no idea. I still like my 50% short S&P, 40-50% closed end high yield and 0-10% closed end gold (ASA). But it's just a holding pattern till we get a stock market sell off and I reduce the S&P short position and do something else with the rest.

Anyway, here is a very thought intensive article: http://www.mauldineconomics.com/outsidethebox/hoisington-quarterly-review-and-outlook-3q2015

 

[LibertyTurns]

Data says we've got a TDST break. If there's follow thru again this week, time to start shifting to a higher percentage long again. Cut a quarter of my cash last week & started rebuilding my equities. Been an odd 4 month period for me. Not used to making such wild swings in such rapid succession but it has been all positive. Been a good boy and have been following the rules. It's hard to be disciplined but if you can it pays off.

https://mobile.twitter.com/ciovaccocapital

 

[Whiskey_Clear]

The Fair Tax. Why in the hell isn't this tax idea more popular???

 

[AlabamaBuzz]

WC: I think there are too many tax attorneys and accountants and IRS jobs to make it easy to sell.

It makes PERFECT sense, so I guess that is why the do-nothings will never consider it, plus it would not have the convoluted tax loopholes that are available to so many of the ultra rich. By the way, I am not against the ultra rich. We need them to invest in jobs, but I do believe these are the reasons we cannot go to something that is so much more common sense as the fair tax.

 

[awbuzz]

The Fair Tax. Why in the hell isn't this tax idea more popular???

Because it would be Fair. As simple as it is too many don't understand the "prebate" concept.

 

[LibertyTurns]

Well ladies, we're nearing the 61.8% FIB retracement on the S&P. Anyone getting nervous?

I'm pulling the plug on the "toe dip" I executed 4th quarter last year if this dog doesn't start hunting.

China only has about 2/3 of their $$ left to prop up the market, maybe less now. I'm guessing they will not be able to arrest their free fall. Going to get very ugly over there. Where are the BRIC fanatics?

Time for some adult leadership from somewhere to step in and take charge. Oh wait, the US doesn't do that any more. Who will it be Angela, Pooty??

We're in a hurt locker right now. Hang on we're in for a wild ride I'm afraid.

 

[buzz_wiser©]

How about 33 on crude oil futures for Feb ...per barrel. ..where is the stopping point for this? I'm ready for the ride. Have been purchasing MREs lol

 

[RLR]

Late to the party. Good thread. Props to @GTNavyNuke for nailing the analysis.

I think this article explains why your below statement is true (granted it's from 2013).

Market only has 35-50% further to fall to be in line with historic downturns. http://hussman.com/wmc/wmc150824.htm

Problem with any analysis is that the Central Banks are targeting asset (stock) prices like they never have in the past. So this time will be different. As I said a month or two ago, I think we are more likely to see QE4 than a rate hike. The Fed talks about supporting the economy, but at the end of the day it is a private entity as Federal Reserve BANK and they will protect the monied interests. No matter that the $4T they have committed hasn't done squat for the economy. http://www.cnbc.com/2015/08/18/st-louis-fed-official-no-evidence-qe-boosted-economy.html