Fixing social security

[SAJ-99]

Taxing capital gains like income means less investors, and a slowing of economic growth and ingenuity. If you show up to work, you can pretty much guarantee getting some pay. If you invest, there’s no such guarantee. If I’m risking losing money and then there’s too big of a bite if I do make gains, what’s my incentive. Might as well stick it in safe bonds and whatnot so I’m not risking the double whammy. I guess the devil is in the sweet spot of where to tax the CG. Taking them at the upper income bracket seems harsh, and I for one would not invest as much if it were so.

Investing is essentially putting excess capital to work. Income or capital gains determines the type of risk you take. You buy a bond, it’s income. You buy the stock and hold it less than 365 days it is income. You hold it 365 days and suddenly, like magic, your tax rate goes down. I would bet it will not stop investment at all.

 

[KG92]

Without the .gov your everyday life would suck. You'd be drinking water out of crick with your neighbor upstream washing his ass in it.

please re-read the very first 7 words of the post you’re replying to

 

[BuzzH]

please re-read the very first 7 words of the post you’re replying to

Yeah, I get it, you want to pick and choose the parts you agree with.

 

[KG92]

Yeah, I get it, you want to pick and choose the parts you agree with.

Of course I do, who wouldn’t? There are some things I think the government should be responsible for, and some things it shouldn’t be involved in.

Isn’t that an opinion held nearly universally?

 

[BuzzH]

Of course I do, who wouldn’t? There are some things I think the government should be responsible for, and some things it shouldn’t be involved in.

Isn’t that an opinion held nearly universally?

Yeah, and for everything you want them involved in, somebody else doesn't...and vice versa.

You don't matter more than anyone else, get over it.

 

[Marshian]

I don't buy it.

The same is said of corporate tax. That if you let companies pay less tax they invest it back into the business, employees, and that whole lie known as trickle down economics.

It's all crap, they just increase pay for ceo's, share holders, and upper management. They don't reinvest, they take bigger profits.

I can’t speak for corporate tax, and I understand your cynicism of trickle down economics. I’m just speaking as an individual investor. If I get creamed too hard, I’m just gonna pay off all my debts first. And invest in safer options albeit with less likely potential. My two cents.

 

[KG92]

Yeah, and for everything you want them involved in, somebody else doesn't...and vice versa.

You don't matter more than anyone else, get over it.

Neither do you, but here you are, advocating for your point just like the rest of us. What’s your point?

 

[BuzzH]

Neither do you, but here you are, advocating for your point just like the rest of us. What’s your point?

I stated a long time ago, I'm happy with how much I pay in taxes, willing to pay more, and pretty happy about what my taxes pay for.

 

[Forkyfinder]

I stated a long time ago, I'm happy with how much I pay in taxes, willing to pay more, and pretty happy about what my taxes pay for.

Easy to say living in WY...

 

[BuzzH]

Easy to say living in WY...

Meh, thought the same when I lived in Montana.

 

[Alpine01]

I don't buy it.

The same is said of corporate tax. That if you let companies pay less tax they invest it back into the business, employees, and that whole lie known as trickle down economics.

It's all crap, they just increase pay for ceo's, share holders, and upper management. They don't reinvest, they take bigger profits.

You don't get it.

Corporations don't pay taxes. The "cost" of taxes are just factored into the total revenue stream that you the consumer end up paying when you buy their product or service. If you have ever seen a large corp's balance sheet you would understand. Taxes, interest paid, asset depreciation along with the cost of the goods sold, salaries and overhead like building maintenance are all taken off to arrive at a net income or profit. That net income has a floor (8-10%) or the company ceases to exist financially. If everything stays the same except for taxes going up, guess what, the company has to raise their prices so the net income math works out in the end. You the consumer pays that increase or the company fades away. How they choose to spend that profit is up to each company - they can pay shareholders a dividend so that investors continue to buy their stock, they can plow that money back into expanding their business (which also translates into hiring more people). If they pay less taxes, they can lower prices to you and gain market share or keep prices high, increase profits and risk losing market share to a company that undercuts them.

But guess what - the power is all yours. Don't like that a company pays their CEO too much, don't buy their product. Don't like that they earn a 50% profit, don't buy their product. Spend your money elsewhere. The consumer pays their salaries, pays the taxes, pays for their building maintenance, etc. Corporations are just the middlemen money handlers between you and the Government. Basic economics.

 

[BuzzH]

You don't get it.

Corporations don't pay taxes. The "cost" of taxes are just factored into the total revenue stream that you the consumer end up paying when you buy their product or service. If you have ever seen a large corp's balance sheet you would understand. Taxes, interest paid, asset depreciation along with the cost of the goods sold, salaries and overhead like building maintenance are all taken off to arrive at a net income or profit. That net income has a floor (8-10%) or the company ceases to exist financially. If everything stays the same except for taxes going up, guess what, the company has to raise their prices so the net income math works out in the end. You the consumer pays that increase or the company fades away. How they choose to spend that profit is up to each company - they can pay shareholders a dividend so that investors continue to buy their stock, they can plow that money back into expanding their business (which also translates into hiring more people). If they pay less taxes, they can lower prices to you and gain market share or keep prices high, increase profits and risk losing market share to a company that undercuts them.

But guess what - the power is all yours. Don't like that a company pays their CEO too much, don't buy their product. Don't like that they earn a 50% profit, don't buy their product. Spend your money elsewhere. The consumer pays their salaries, pays the taxes, pays for their building maintenance, etc. Corporations are just the middlemen money handlers between you and the Government. Basic economics.

Right, that's why corporate tax rates dont matter and businesses spend millions lobbying Congress to lower them. They just care about us consumers, nothing in it for them. Laffin'....

Then they squeal like stuck pigs when they're raised...sell crazy somewhere else.

 

[BuzzH]

You don't get it.

Corporations don't pay taxes. The "cost" of taxes are just factored into the total revenue stream that you the consumer end up paying when you buy their product or service. If you have ever seen a large corp's balance sheet you would understand. Taxes, interest paid, asset depreciation along with the cost of the goods sold, salaries and overhead like building maintenance are all taken off to arrive at a net income or profit. That net income has a floor (8-10%) or the company ceases to exist financially. If everything stays the same except for taxes going up, guess what, the company has to raise their prices so the net income math works out in the end. You the consumer pays that increase or the company fades away. How they choose to spend that profit is up to each company - they can pay shareholders a dividend so that investors continue to buy their stock, they can plow that money back into expanding their business (which also translates into hiring more people). If they pay less taxes, they can lower prices to you and gain market share or keep prices high, increase profits and risk losing market share to a company that undercuts them.

But guess what - the power is all yours. Don't like that a company pays their CEO too much, don't buy their product. Don't like that they earn a 50% profit, don't buy their product. Spend your money elsewhere. The consumer pays their salaries, pays the taxes, pays for their building maintenance, etc. Corporations are just the middlemen money handlers between you and the Government. Basic economics.

I'd like some specific examples of these savings being passed down to the consumer when trump lowered corporate tax rates to record lows.

What are we paying less for in 2024 than we did in 2016?

With the massive tax breaks Congress handed to corporations, should be a snap to give hundreds of examples of consumers realizing the kindness passed on to them from corporate America.

 

[406dn]

Taxing capital gains like income means less investors, and a slowing of economic growth and ingenuity. If you show up to work, you can pretty much guarantee getting some pay. If you invest, there’s no such guarantee. If I’m risking losing money and then there’s too big of a bite if I do make gains, what’s my incentive. Might as well stick it in safe bonds and whatnot so I’m not risking the double whammy. I guess the devil is in the sweet spot of where to tax the CG. Taking them at the upper income bracket seems harsh, and I for one would not invest as much if it were so.

I'll call BS.

The market is still the most attractive place to put money to work long term. Last week marked 11 years of retirement for me. The lump sum for the pension I received and the savings plan thru my employer have been heavily allocated in the market the entirety of my retirement. All the distributions are taxed as ordinary income. Every dollar of capital gains I've made will be taxed as income, not a capital gain.

Even so, after 11 years of living in retirement, the total nest egg is a little short of twice as much as the first day of retirement.

So, for all of your bluster, you are going to invest in the market.

The one and only reason that investment income is treated so kindly is that the wealthy are very effective getting their favored policies.

 

[Marshian]

I'll call BS.

The market is still the most attractive place to put money to work long term. Last week marked 11 years of retirement for me. The lump sum for the pension I received and the savings plan thru my employer have been heavily allocated in the market the entirety of my retirement. All the distributions are taxed as ordinary income. Every dollar of capital gains I've made will be taxed as income, not a capital gain.

Even so, after 11 years of living in retirement, the total nest egg is a little short of twice as much as the first day of retirement.

So, for all of your bluster, you are going to invest in the market.

The one and only reason that investment income is treated so kindly is that the wealthy are very effective getting their favored policies.

Wrong, when the market was at all time highs, I did not invest in the market and the tax man was part of that. I’m only speaking for myself, but that is a consideration. I choose to pay off debts at some point . Your 11 years has been pretty cherry picked in terms of growth. There are certainly times in the past where that growth wasn’t so profound. I was already taxed once when I earned it to put that money in. I’m fine taxing it again, but when is enough, enough. Hence my statement about the devil in the details.

 

[Cornbread]

Earning just under 20% of all income but paying 45.8% of the tax seems like a pretty good deal for the people making 80% of the income but only paying 54.2% of the tax.

Could they pay more? Probably. Are they an unlimited piggy bank. Nope. Where's the line?

Where IS the line??? And there in lies the rub. So many perceptions in this thread that are just not true.

 

[406dn]

Wrong, when the market was at all time highs, I did not invest in the market and the tax man was part of that. I’m only speaking for myself, but that is a consideration. I choose to pay off debts at some point . Your 11 years has been pretty cherry picked in terms of growth. There are certainly times in the past where that growth wasn’t so profound. I was already taxed once when I earned it to put that money in. I’m fine taxing it again, but when is enough, enough. Hence my statement about the devil in the details.

I do not deny that there was good fortune with the timing of my retirement. However, I am hardly alone. Anyone who has had a decent amount of money in the market since the aftermath of the 2008/09 recession has done equally well. It is not like I'm a market guru. I did know that owning stocks was the best place to grow one's money.

There are not many decade spans of time that one can point to when the market has not offered good returns. That is just a historical fact.

It is also a fact that the generous tax treatment of capital gains has much less to do with what's good for the economy, but rather what is good for wealthy investors.

 

[Cornbread]

Wrong, when the market was at all time highs, I did not invest in the market and the tax man was part of that. I’m only speaking for myself, but that is a consideration. I choose to pay off debts at some point . Your 11 years has been pretty cherry picked in terms of growth. There are certainly times in the past where that growth wasn’t so profound. I was already taxed once when I earned it to put that money in. I’m fine taxing it again, but when is enough, enough. Hence my statement about the devil in the details.

Correct. There was a period where stock didn't do shit for 16, yes 16, years. The market, and stock returns have been artificially pumped up by fiscal & monetary policy, i.e. our govt thru the wealth effect.

 

[BuzzH]

Wrong, when the market was at all time highs, I did not invest in the market and the tax man was part of that. I’m only speaking for myself, but that is a consideration. I choose to pay off debts at some point . Your 11 years has been pretty cherry picked in terms of growth. There are certainly times in the past where that growth wasn’t so profound. I was already taxed once when I earned it to put that money in. I’m fine taxing it again, but when is enough, enough. Hence my statement about the devil in the details.

Historical Average Stock Market Returns for S&P 500 (5-year to 150-year averages) - Trade That Swing

These are the average yearly returns of the US stock market over the last 5, 10, 20, 30, 50, 100, and 150-years. Data is based on the S&P 500.

tradethatswing.com

 

[406dn]

Here is a link for S&P500 returns going back to the Great Depression

S&P 500 Historical Annual Returns

Interactive chart showing the annual percentage change of the S&P 500 index back to 1927. Performance is calculated as the % change from the last trading day of each year from the last trading day of the previous year.

www.macrotrends.net