BY KELLY COHEN
Taxes are always up for debate, be it Americans thinking they pay too much or Americans thinking others don’t pay enough
The graphic below from the Pew Research Center shows exactly who is funding the government — and what percentage comes from taxes.
As noted, 46.2 percent of the government is funded by individual income taxes — though six in 10 Americans told Pew they were bothered a lot by the feeling that “some wealthy people” don’t pay their fare share. Similarly, 64 percent felt that way about corporations — however, a mere 10.6 percent of the U.S. government is funded by corporate income taxes.
BY SHANE FERRO
This could be the scariest chart in the world, from Deutsche Bank’s Torsten Sløk. Nearly half of American households don’t save any of their money.
If it it isn’t obvious, this has a broad range of implications. People who don’t save won’t have any buffer should the economy turn and they lose their jobs. Longer term, people who don’t save won’t have the capacity to retire.
It’s not good.
BY JASON RUSSELL
The Congressional Progressive Caucus budget proposal would raise federal tax revenues to record highs, yet still fails to balance over the next decade, unlike the House and Senate Republican budget proposals.
Under the Progressive Caucus proposal, tax revenue would rise to 21.5 percent of GDP, compared to the record-high 20.5 percent of GDP collected in 1944, at the height of American involvement in World War II. Tax revenue would rise by $6.6 trillion relative to current law over a decade, some of which would be raised through higher economic growth.
Changes to the individual income tax code would amount to a $1.4 trillion tax hike over a decade, according to analysis by the liberal Economic Policy Institute. The budget proposal would raise individual income taxes on those earning over $200,000 a year ($250,000 for joint filers), with the 33 percent tax bracket rising to 36 and the 35 percent tax bracket rising to 39.6 percent. It would raise taxes even further on incomes over $1 million, taxed at 45 percent, and over $1 billion, taxed at 49 percent, with other tax brackets for incomes above $10 million, $20 million and $100 million. Capital gains and dividends would also be treated as ordinary income, meaning they would be taxed at higher levels.
The Progressive Caucus budget proposal would also raise $904 billion in the next decade through various changes to the corporate tax code. The financial industry would be further hit by a new $908 billion financial transactions tax as well as $100 billion tax raised through a new tax on companies deemed systemically important financial institutions.
The financial industry is targeted because, as the budget writers note, they consider certain financial activities an “economic ‘bad.'” Under the same justification, pricing of carbon emissions would raise taxes by another $1.2 trillion over a decade. The federal excise tax on cigarettes would rise by $0.50 per pack, a $38 billion tax hike over a decade. Also, changes in the estate tax would raise taxes by $178 billion over a decade.
Federal spending would also rise to high levels in the budget. In 2024, federal spending would be 22.9 percent of GDP, up from 2015’s expected 20.8 percent. Federal spending peaked at 24.4 percent during the recession, but the budget proposal assumes economic growth, not recession. The average over 1990-2014 was 20.2 percent of GDP.
Sen. Bernie Sanders, I-Vt., is the only Senator in the Congressional Progressive Caucus. Sixty-nine members of the House are in the caucus, including co-chairs Congressman Raúl Grijalva, D-Ariz., and Congressman Keith Ellison, D-Minn.
The budget has been endorsed by a laundry list of liberal organizations, including Americans for Tax Fairness, Daily Kos, Moveon.org, and the National Education Association.
by ZERO HEDGE | MARCH 23, 2015
Following January’s disastrous dive in Existing Home Sales (which must be weather, right? Nope!) to a SAAR 4.82 million homes, February (with its even worse weather) saw a 4th month of missed expectations with a 4.88mm print against 4.90 mm expectations. As always, weather was blamed – which is odd given that the only drop in sales that occurred happened in The Northeast which accounts for just 12% of total transactions. Perhaps more worrisome is NAR’s Larry Yun noting “unsuitable price levels” as a reason for weak sales due to low inventories (despite inventories rising 1.6% in February?!). May be it’s time to blame The Fed… for not creating more rich people to buy more houses…
Another month, another miss…
- *FEB. MEDIAN HOME PRICE RISES 7.5% FROM YEAR AGO TO $202,600
Northeast sales fells 6.5% MoM, The West rose 5.7% MoM with the The Midwest flat and South up 1.9% MoM.
NAR’s Larry Yun explains…
“Severe below-freezing winter weather likely had an impact on sales as more moderate activity was observed in the Northeast and Midwest compared to other regions of the country.”
although February sales showed modest improvement, there’s been some stagnation in the market in recent months. “Insufficient supply appears to be hampering prospective buyers in several areas of the country and is hiking prices to near unsuitable levels,” he said. “Stronger price growth is a boon for homeowners looking to build additional equity, but it continues to be an obstacle for current buyers looking to close before rates rise.”
“Stronger price growth is a boon for homeowners looking to build additional equity, but it continues to be an obstacle for current buyers looking to close before rates rise.”
And begs The Fed to not raise rates…
“With all indications pointing to a rate increase from the Federal Reserve this year – perhaps as early as this summer – affordability concerns could heighten as home prices and rents both continue to exceed wages,”
Lazy investors totally dependent on the Federal Reserve
by ZERO HEDGE | MARCH 20, 2015
Fresh from a well-publicized dollar dispute with Goldman’s Gary Cohn, recently retired Dallas Fed chief Richard Fisher made an appearance on CNBC Friday and spoke with Rick Santelli. There were quite a number of notable exchanges including the following zingers..
Santelli: “If you had to rate the US economy 0-10 where would you peg it?”
Fisher: “We’re #1., we’re a 10. We’re the epicenter of growth and in the sweet spot.”
Santelli: “Do you think any part of the stock market being high has anything to do with the committee you just left and if you didn’t grade the economy on a curve would you still give it a 10?”
Fisher: “Well, what worries me is how totally lazy investors have gotten, totally dependent on the Federal Reserve and I find this to be a precarious situation.”
Fisher: “Are we vulnerable in my personal opinion to a significant equity market correction? I believe we are.”
Then Santelli pulls out a Pavlov reference suggesting that the Fed has in fact conditioned retail investors to be lazy prompting Fisher to point out the irony in the fact that global financial markets are depending on a “diminutive woman” (Yellen) to play Atlas. “What worries me is that the people that watch this show are completely dependent on the Fed — look at the volatility. I could see a correction taking place of substantial magnitude.”
Of course this is all the market’s fault and not the Fed’s for ballooning their balance sheet into the trillions and effectively daring investors not to chase a central bank-underwritten rally in risk assets and so ultimately, Fisher thinks the “people who watch” CNBC need to stop being so complacent.