Prices not going down??

[Happ]

Originally Posted by CarinaPDX

Yep, that's right. And it is happening because the wealthy and corporate interests have paid Congress to create this unfair tax system. CEOs are mostly paid with stock options, not stock grants, and these are treated as having no value (no income tax is paid by the recipient at the time the options are granted). Then when they vest the recipient does a one-day purchase and sale, and either pays no tax (incentive stock options) or capital gains tax (because the options are held long enough). Since this is so favorable to the CEOs, they are highly motivated to push the stock prices up by buybacks instead of distributing dividends. Stockholders put up with it because for them paying taxes on capital gains is preferable to taxes on straight income. They shouldn't (assuming they have any say in the matter, which they don't). It is a tax system that actively incentivizes CEOs to put their companies at risk by over-leveraging, and puts far too much money in CEO pockets. Also, because these are options and not stock, if things turn bad (because of the high risk) management just walks away without losses.

I am not optimistic that the public will rise up and demand a fair system. But until we have a fair tax system and corporate governance we are going to continue to suffer.

Stay safe.

Greg

You are very astute. Back in the mid to late 1970’s a tax change eliminated a tax strategy used by traders. Commodity traders could structure trades with virtually minimal risk to create huge loses and offsetting profits simultaneously. Then at the end of the year they would close out the loosing trades offsetting their profits for the year. On or around Jan 1st they would close out the profit side of these trades. In essence they rolled their taxable income over to the next year. When the tax law was changed traders couldn’t make enough to pay all the taxes they owed because they were rolling their tax liabilities over for many, many years.

Unfortunately in today’s political climate we will not correct the detrimental tax laws because corporations will complain they can’t stay in business without the advantages. Interesting note. CEO’s in the US make about 5x what a CEO makes in Europe.

[Happ]

Originally Posted by rabbi

Taking this out of context it reads like you want to see that yellow haired guy naked !
Strange fetish... Fifty shades of yellow

You just gave me nitemare! I may never sleep through another night. LOL!!!!!!

[Happ]

Originally Posted by rabbi

I don't think we will reach this point. To get back to individual containment we'd need to turn back the clock to mid February.

Germany was pretty good at tracing & isolating the first cases. But with open borders and non-existent screening at airports it was clear from the beginning that we could only loose this battle.

Anyway now we are in social distance mode. Still allowed to leave home for work (if you still have something to do), grocery / pharmacy shopping (everything else closed), and do individual outdoor sports. No more than 2 individuals allowed to gather, minimum distance required 1.5m.

This will certainly reduce new infections, but nowhere near the 2-3 digit figures that we can manage to successfully trace & isolate. So it won't put us back into February.
To reset the timeline back to mid February we'd need a 100% curfew & lockdown for 3 weeks. I hope that nobody seriously tries this, as acceptance of such measures would be extremely low.

Also I don't think its the smartest idea as it would take forever to reach herd immunity.

Instead the idea is to reduce the number of active cases to just stay below ICU capacity. We have to keep it that way until we find a vaccine or reach the point of herd immunity.
Either way it will be a long time, and containment measures will have to be constantly adjusted to keep CV cases within certain thresholds. Too many cases at once and people die in overcrowded hospitals, even from unrelated accidents. Too few and ICUs will be underused, and the time to reach herd immunity is longer than required (each day costs billions).

That is the idea. We will see if this works out.


Based on current numbers our response was a bit too successful / early. We are currently underusing our ICU capacity by a large margin. Only a handful of hospitals report busy ICUs, the vast majority is still green.
But then I have no idea how this will look like in 1-2 weeks when the first peak hits us.

Really? That’s why we sent a US Military hospital ship to NY! We acted to early? The President has been downplaying this virus and won’t even take responsibility for disbanding the White House Pandemic Team in 2018! He acted in his perception of what is good for him.

[Happ]

Originally Posted by Lake-Effect

I have a stupid (no, REALLY STOOPID) set of world-economy questions and proposals. Of course anyone can weigh in (with enforced idleness we're all ruminating on this stuff), but I would really like to hear from those with serious experience in this area.

Here goes.

In most major economies, the economic effects of isolation/self-distancing orders is affecting just about everyone.

Let's arbitrarily state that we have to remain locked-down for April and May.

Here comes the stupid: Why can't we all agree that EVERY financial obligation is suspended for two months? Eg - stop the clock on every financial deadline? Suspend all trading on the stock market. Every mortgage, rent due, visa bill, bond, note, etc etc, no interest accruing on assets or debts - the due date of everything is pushed forward by two months.

The immediate and obvious objection to this is that we need funds out of the market ie liquidity to keep everything running, people need to eat, etc. To which I say yes, of course, but if every financial obligation is pushed forward by two months, then the amount of immediate required liquidity required anywhere goes way down, yes? That would mean that the governments wouldn't have to inject as much cash in to keep things running for right now.

Not my area at all... but maybe some financial markets might possibly be allowed to operate in some very restricted fashion to generate a bit of liquidity as well?

Analysis? Thoughts?


You've probably guessed that I would favour the bulk of any stimulus go to PEOPLE, who need to keep spending a little to live, rather than at the top of the money chain to allow corporations and the wealthy to continue to make money while the rest of us actually suffer. If the market was on hold for two months, NO corporation would actually need money... just their employees, right?

At the end of May, press GO again, and April's obligations would fall due... in June. And we pick up where we left off.

Poke away.

The simple answer is many if not the majority of people in the US live paycheck to paycheck. What if someone gets sick and needs medical care if they own assets they might have to sell them or borrow against them. A total shutdown would destroy the US economy. Keep this in mind 80% of stock is held by 12% of the people.

[robert sailor]

Originally Posted by Iaangus

Your fake news is not appreciated regardless if it's due to ignorance or political partisanship. It only takes a minute to educate yourself.

Have a read you might learn something


https://en.m.wikipedia.org/wiki/Spanish_flu

[robert sailor]

Originally Posted by Happ

Not to get to political here but the 30% Tax Cut by Trump gave corporations money to grow and expand their companies. They didn’t. They bought back stock helping drive the market higher. No fundamental change in the companies. Instead we could have used that money to start reducing the debt. That was the whole idea about saving the economy. It would come back and grow generating more tax dollars to pay back the bailout.

Good point but it even goes deeper. Many of those companies decided not to keep any cash reserves for a rainy day and some used 95% of their cash reserves to buy back stock. Fat bonuses for the e executives and now with the market in a tough spot they have their hands out wanting and getting bailouts. If I was king for a day I'd make them sell all their corporate held stock before I gave them a penny of tax payers money.

[Island Time O25]

Originally Posted by robert sailor

Good point but it even goes deeper. Many of those companies decided not to keep any cash reserves for a rainy day and some used 95% of their cash reserves to buy back stock. Fat bonuses for the e executives and now with the market in a tough spot they have their hands out wanting and getting bailouts. If I was king for a day I'd make them sell all their corporate held stock before I gave them a penny of tax payers money.

You're too kind. I'd jail most of them for perpetrating a Ponzi scheme. Along with all the Fed Reserve governors. And then start fresh from a blank page. Why should just Bernie Madoff be the scapegoat for the whole team?

[Wotname]

Thanks to all who answered a few of my money questions several pages back!

It seems to me that money is only thing in the known universe that does not conform with the laws of gravity.

Some examples:

It never seems to trickle down even though that concept is espoused regularly by the money manipulators.

It seems to rush upwards way more than capillary action suggest.

[Island Time O25]

Originally Posted by Wallaby

Any debt-funded nation is in deep trouble; the more debt, the greater the trouble. China is looking at a debt disaster. The US is not far behind.

The only silver lining is that the US economy has better self sufficiency position, if it needed to go that way. Not just energy but lots of other stuff. And our internal markets are large and robust enough to be truly independent of the World. Definitely robust with Canada and Mexico in the mix. China is too dependent on globalism at this point, their Achilles' heel these coming times. Perhaps if they take Siberia they'd more in position like US.

[Pelagic]

I haven't bothered to read thru all this salivating over a pandemic opportunity to buy a cheap boat.
Kinda reminds me of those who pick thru the remains of Holocaust Victims.

If anything, I'm hoping that those who bought a boat for the right reasons, but got distracted by social bling, will revalue their priorities..... and go sailing.

[DumnMad]

Originally Posted by Wotname

Thanks to all who answered a few of my money questions several pages back!

It seems to me that money is only thing in the known universe that does not conform with the laws of gravity.

Some examples:

It never seems to trickle down even though that concept is espoused regularly by the money manipulators.

It seems to rush upwards way more than capillary action suggest.

Trickle down doesn't work for the jealous who think it should come for free or just don't want to work.
Superyacht crews, boat builders, boat maintenance workers all enjoy the trickledown effect.

[CarinaPDX]

Most of us know exactly what is trickling down on us, and it isn't money.

[Buzzman]

Originally Posted by CaptainJohn49

You are obviously not a UNION man. Unions would rather choke a business to death and see it go out of business then take a reduction in wage. Ask any former union worker in Pennsylvania, Michigan of Minnesota what happened to their job.
Now unions have found the perfect employer - governments.

Utter bollocks - in this country at least.

Unions have worked closely with govts (of both persuasions) to enable businesses to flourish (but not at the expense of the workers)

Most recently our Union organisation accepted there would need to be changes (temporary) to the legislation governing employment contracts and awards, to enable businesses to offer pay cuts, during the crisis.

It **really** peeves me when people trot out this 'anti-union' crap....

[wolfgal]

Originally Posted by Wallaby

Bad news for the EU, it is failing after years of mismanagement. Britain was first out the door. Others will follow. The Covid-19 crisis will take the Euro down with it.

your opinions on this thread are in line with what i am perceiving, though a thousand times less intellectually.

if you were financially based in a european country primarily, what actions would seem the most sound to you with your liquid savings (your future boat and boat life)?
-would you think it better to buy more gold knowing that the market is manipulated?
or would you buy more, even at todays staggering prices, given the likelihood of a sharp increase (based on post 2008)?
-or would you transfer liquid to a dollar acct, with the idea of bring it back over when the moment seemed opportune?
-or do you think banks will not fold in europe, that guaranteed savings are safe ...well, until inflation hits (and the euro goes crypto)?

just curious to know your opinion. thank you

an interesting article on gold manipulation:
https://dailyreckoning.com/how-gold-is-manipulated/

[pt49]

Originally Posted by atlroofman

The dollar will devalue compaired to what currency ?
Whose currency will be worth more than the US dollar ?
This is a world wide problem.
The flight will be to the US dollar not from it.
The world's reserve currency will always be the landing zone for flight from nonreserve currency's.

The only currencies that will be worth more than the US$ are Gold and Bitcoin.