Obama's Fiscal Cliff

[Cruella]

Isnt this like Enron ? Congress cares not. sigh

I don't get how it works. If he's printing money to the tune of trillions every year, how does that help anyone? What is it doing to the value of the dollar?

 

[Dr.Who]

Welcome to QE 4. Bernanke, in addition to the QE 40 billion a month he has been printing, he has now added an additional 45 billion he's also printing monthly, which he said he's going to do for the next 3 years.

QE4 Is Here: Bernanke Delivers $85B-A-Month Until Unemployment Falls Below 6.5% - Forbes

There are just some realities in life that are so eggregeous that it is appalling no one seems to care.

-the gov printing money as a hidden tax on everyone including the poor
-the 1 in 2 lifetime risk of getting cancer that was once way lower
-the huge number of people who die from heart attacks that were once so rare that the inventor of the ER EKG was told to abandon his machine because no one needed it.
-the socialism that passes as social democracy

the elephants are too numerous

 

[Dr.Who]

I don't get how it works. If he's printing money to the tune of trillions every year, how does that help anyone? What is it doing to the value of the dollar?

It is making it so that it costs almost five dollars to buy a gallon of gas.

 

[dogtowner]

I don't get how it works. If he's printing money to the tune of trillions every year, how does that help anyone? What is it doing to the value of the dollar?

its devaluing the dollar. some of the effect is concealed because of the recession in euroland and slowdown elsewhere.
its also serving as currency manipulationthat we take issue with china doing.
it makes the msrkets less free and is a game you cannot win.
ask zimbabwe...

 

[cashmcall]

I don't get how it works. If he's printing money to the tune of trillions every year, how does that help anyone? What is it doing to the value of the dollar?

Despite all the political rhetoric today about how nobody's taxes will be raised, except for "the rich," inflation transfers a percentage of everybody's wealth to a government that expands the money supply. Moreover, inflation takes the same percentage from the poorest person in the country as it does from the richest.

That's not all. Income taxes only transfer money from your current income to the government, but it does not touch whatever money you may have saved over the years. With inflation, the government takes the same cut out of both.

It is bad enough when the poorest have to turn over the same share of their assets to the government as the richest do, but it is grotesque when the government puts a bigger bite on the poorest. This can happen because the rich can more easily convert their assets from money into things like real estate, gold or other assets whose value rises with inflation. But a welfare mother is unlikely to be able to buy real estate or gold. She can put a few dollars aside in a jar somewhere. But wherever she may hide it, inflation can steal value from it without having to lay a hand on it.

No wonder the Federal Reserve uses fancy words like "quantitative easing," instead of saying in plain English that they are essentially just printing more money.

The biggest and most deadly "tax" rate on the poor comes from a loss of various welfare state benefits-- food stamps, housing subsidies and the like-- if their income goes up.

Some government policies help some people at the expense of other people. But some policies can hurt welfare recipients, the taxpayers and others, all at the same time, even though in different ways.

Why? Because some are too easily impressed by lofty political rhetoric and too little interested in the reality behind the words.

 

[Cruella]

So if it's like a hidden inflation, what would our inflation rate be now, had they not printed the money? I don't think Carter printed money (or did he?). but his interest rates were insanely high.

Also, what is the relationship between inflation and interest rates?

 

[Gipper]

Despite all the political rhetoric today about how nobody's taxes will be raised, except for "the rich," inflation transfers a percentage of everybody's wealth to a government that expands the money supply. Moreover, inflation takes the same percentage from the poorest person in the country as it does from the richest.

That's not all. Income taxes only transfer money from your current income to the government, but it does not touch whatever money you may have saved over the years. With inflation, the government takes the same cut out of both.

It is bad enough when the poorest have to turn over the same share of their assets to the government as the richest do, but it is grotesque when the government puts a bigger bite on the poorest. This can happen because the rich can more easily convert their assets from money into things like real estate, gold or other assets whose value rises with inflation. But a welfare mother is unlikely to be able to buy real estate or gold. She can put a few dollars aside in a jar somewhere. But wherever she may hide it, inflation can steal value from it without having to lay a hand on it.

No wonder the Federal Reserve uses fancy words like "quantitative easing," instead of saying in plain English that they are essentially just printing more money.

The biggest and most deadly "tax" rate on the poor comes from a loss of various welfare state benefits-- food stamps, housing subsidies and the like-- if their income goes up.

Some government policies help some people at the expense of other people. But some policies can hurt welfare recipients, the taxpayers and others, all at the same time, even though in different ways.

Why? Because some are too easily impressed by lofty political rhetoric and too little interested in the reality behind the words.

Yes the inflationary policies of the Fed are harmful, but not to everyone. According to this, the super wealthy benefit handsomely.

http://www.washingtonsblog.com/2012...-the-little-guy-and-the-american-economy.html

 

[Dr.Who]

Yes the inflationary policies of the Fed are harmful, but not to everyone. According to this, the super wealthy benefit handsomely.

http://www.washingtonsblog.com/2012...-the-little-guy-and-the-american-economy.html

If a group of people enter an orchard and some benefit more due to their own diligence, hard work and wits then their efforts are to be applauded. If access to the orchard is made available only to those who can figure out when the secret gates are unlocked due to their previous position in life then that is unfair.

In both instances some people just take advantage of what all could have taken advantage of. But in the first (free market analogy) the playing field is level, in the second (it matters who you know and who you are analogy) the playing field is not. Dems often talk about a level playing field but never attempt to achieve one, intead they strive for more control over how the field is made unlevel.

 

[Dr.Who]

Despite all the political rhetoric today about how nobody's taxes will be raised, except for "the rich," inflation transfers a percentage of everybody's wealth to a government that expands the money supply. Moreover, inflation takes the same percentage from the poorest person in the country as it does from the richest.

Taking the same percentage from everybody is completely fair. However, if you think that the poorest deserve a deduction (loophole) so that they pay no tax on the measly $100 dollars they have then it ceases to be fair because inflation taxes money with no deductions. We should strive to tax everyone at the same rate for every dollar but also to provide everyone with the same deductions. We need to apply the same laws to everyone without attempting to rig the system by pre-determining the outcomes.

That's not all. Income taxes only transfer money from your current income to the government, but it does not touch whatever money you may have saved over the years. With inflation, the government takes the same cut out of both.

It taxes future money too.

It is bad enough when the poorest have to turn over the same share of their assets to the government as the richest do

They should pay the same share and have the same deductions.

, but it is grotesque when the government puts a bigger bite on the poorest. This can happen because the rich can more easily convert their assets from money into things like real estate, gold or other assets whose value rises with inflation. But a welfare mother is unlikely to be able to buy real estate or gold. She can put a few dollars aside in a jar somewhere. But wherever she may hide it, inflation can steal value from it without having to lay a hand on it.

She may be too stupid to shelter her money from inflation but that does not mean she cannot. Corn for example has suffered a tremendous rate of inflation (I think along the lines of 400%), If she takes the few dollars she has and buys next weeks cornflakes as well as this weeks then she "saves" a huge amount. That is equvialent to the rich person buying gold. He may spend and shelter more total but she just might save a larger percent. It is still wrong that she is put in this position at all when she should just be able to concern herself with finding a job to pay her bills without extra efforts that might be beyond her ability to comprehend. Especially considering that the wealthy are probably tipped off to what is going to happen and she probably finds out after it is too late.

No wonder the Federal Reserve uses fancy words like "quantitative easing," instead of saying in plain English that they are essentially just printing more money.

That s how the wealthy get tipped off.

The biggest and most deadly "tax" rate on the poor comes from a loss of various welfare state benefits-- food stamps, housing subsidies and the like-- if their income goes up.

?? Are you saying if they get a job and their income goes up they lose benefits and that is bad?

 

[dogtowner]

So if it's like a hidden inflation, what would our inflation rate be now, had they not printed the money? I don't think Carter printed money (or did he?). but his interest rates were insanely high.

Also, what is the relationship between inflation and interest rates?

if you artificially increase the money supply AND artificially lower interest rstes then you make inflation artificially low.
Carter did not but those circumstances would have rendered doing so ineffective.

they are almost directly connected but manipulation is possible.

until such time as when the piper has to paid. then you have the collapse ala Zimbabwe.

 

[Cruella]

until such time as when the piper has to paid. then you have the collapse ala Zimbabwe.

That's my fear. If we stopped printing money and borrowing money, how bad do you think it would be here?

 

[dogtowner]

That's my fear. If we stopped printing money and borrowing money, how bad do you think it would be here?

bad certainly but the longer you put it off the worse it gets.
the time of recconing is coming so would you rather handle it with planning and foresight or have it hit you like a.massive heart attack ?

things cant get better till you hit bottom. right now we're an elevator in freefall.

 

[cashmcall]

Yes the inflationary policies of the Fed are harmful, but not to everyone. According to this, the super wealthy benefit handsomely.

http://www.washingtonsblog.com/2012...-the-little-guy-and-the-american-economy.html

thats my piont ...

 

[dogtowner]

thats my piont ...

do you think Warren Buffet wants a free economy ? nope.

 

[Hobo1]

I recently read an article that said Congress and the President are just "just kicking the can down the road". That is, during both the Bush and the Obama years, we have just ignored our tax/spending problem - pushing it to be solved at some future (unspecified) date.

Right now we can use financial tricks and borrowing to avoid a crisis, but that can't last forever.

At some point the US is going to reach the point where we can't ignore the problem and it can't be fixed. Massive inflation? Unimaginable unemployment. Business and personal bankruptcy will mean reduced tax income. I wonder how bad things can really get?